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Thailand Real Estate Report Q1 2012
Business Monitor International, Nov 2011, Pages: 42
Thailand is currently suffering from the worst monsoon floods in at least 50 years. The effect of the floods will be long-lasting and could greatly alter the picture we currently have of the real estate market. During October 2011 businesses have been affected, a number of industrial plants were shut down, homes were destroyed and many projects abandoned. While the eventual clear-up efforts could provide a shortterm boost to construction companies, reports warn that Thailand’s economy has taken a hit in 2011 and going into 2012.
Following the July 2011 election of Yingluck Shinawatra and her August 2011 inauguration as prime minister, it is hoped that political stability will return to the country, which could benefit a number of real estate developers with ties to the government. Following years of political unrest since the military coup of 2006, this could spell a period of medium-term stability in the real estate sector, replete with new projects and diversification into less developed provinces.
Key Opportunities In The Real Estate Market:
- Pattaya is proving to be an increasingly popular destination for overseas investors and local developers. The beach holiday destination’s proximity to Bangkok and value for money are maintaining strong demand for holiday properties and new projects in the area.
- The new Pheu Thai government is hoped to improve long-term investor sentiment, as the political instability of the past few years dies down.
- Property price cooling measures in China are leading buyers into nearby overseas markets and Thailand’s proximity to the country has the potential to draw a number of Chinese investments.
- Bangkok is hosting a real estate conference: Real Estate Investment & Law Updates, in late October 2011. It is hoped that the event will increase discussion on attracting investment in the residential, commercial and hospitality real estate sectors.
Key Risks To The Current Real Estate Market:
- The severity of the flooding in Thailand is not yet known, but it is likely that damage will run into billions of baht for homeowners and developers. It will be some time before clear-up efforts begin and stalled projects resume.
- Demand for office space in Bangkok appears to have remained stagnant over 2011. No project completions are expected in 2012.
- The improved political situation follows years of unrest, which may not completely disappear for a few months or years.
Business Monitor International's Thailand Real Estate Report provides industry professionals and strategists, corporate analysts, real estate associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Thailand's Real Estate industry.
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