As a local real estate agent in Pattaya, Rightmove Pattaya has many foriegn buyers, so we are closely following the government's recent consideration to raise the foreign ownership cap in condominiums from 49% to 75%. This potential change, announced by Deputy Prime Minister Phumtham Wechayachai, could significantly impact our local property market.
Additionally, the Ministry of Interior is exploring the feasibility of extending leasehold periods for foreigners from 50 years to 99 years. These proposals aim to stimulate the economy and attract more foreign investment, a strategy first discussed in a cabinet meeting in April.
Our local property market has seen increasing demand from foreign buyers, even as domestic demand has been affected by high household debt and stricter lending conditions. Developers have been cautious, with the number of land allocation permits nationwide dropping by 19.7% in the first quarter of this year—the largest decline in nine quarters.
The Real Estate Information Center (REIC) highlighted that in popular destinations like Pattaya and Phuket, foreign ownership quotas in many condo projects are already fully occupied. This indicates a robust foreign interest in our market, which could benefit from an increased ownership cap.
Certain areas in Pattaya and Jomtien do not attract as many domestic buyers, making them ideal for higher foreign ownership quotas. This adjustment could stimulate the local economy by catering to the strong foreign demand, which is critical for our condo market.
Some developers have been proactive, reserving units for leasehold contracts priced 10-15% lower than freehold units to appeal to foreign buyers. This approach has been successful, as evidenced by the 25% increase in condo transfers by foreigners in 2023, totaling 14,449 units valued at 73.1 billion baht—surpassing pre-pandemic levels.
Chinese buyers accounted for the largest share of these transfers, followed by Russians, Americans, and Myanmar nationals. An increase in the foreign ownership cap and longer leasehold terms would likely further boost these numbers, making Pattaya and Jomtien even more attractive to international investors.
As we anticipate these potential regulatory changes, it’s crucial for local real estate professionals to stay informed and prepared to assist our clients in navigating this evolving market landscape.
