Issue 7 | Feature brought to you by Absolute World
Pattaya’s property market is undeniably promising, but investors need to think not only about where to buy, but what to buy. Bryan Foster of Absolute World tells us why second-hand properties in Pattaya are currently offering some of the best investment opportunities in Thailand.
The fast-developing nation of Thailand, with its relatively foreigner-friendly real estate laws, low cost of living, and huge draws for tourism has made its property market one of the world’s most enticing places to invest today. Within Thailand, the market for property in the coastal city of Pattaya is one of the most dynamic, showing huge potential for increased land value in the very near future.
For investors who are looking to capitalize on Thailand’s real estate, Pattaya should unquestionably be considered. But aside from the “where to buy,” there is another question they must ask themselves: “What to buy?” To buy new, or second-hand?
Bryan Foster, the director of real estate at Absolute World says that while the idea of buying new property is certainly attractive for many reasons, it is the second-hand properties in Pattaya that offer some of the safest and easiest investments in Thailand. Below, we discuss five reasons why Pattaya is the place in Thailand where opportunistic property investors should look, and to each, Foster offers his point-of-view on why second hand properties should be considered first.
1. Pattaya is projected to become an extension of Bangkok
It’s already possible to reach Pattaya within one hour of Bangkok, which makes it an easy choice for city-dwellers looking for a weekend at the beach. Pattaya however may soon become this group’s new permanent home. With so many upcoming infrastructural changes in Thailand, such as a new high-speed train line and Bangkok’s outwards-expanding BTS and MRT lines, the distance between metro-Bangkok and Pattaya is literally becoming smaller each year. Thus, in the not-so distant future, Pattaya will offer a feasible daily commute into Bangkok, vastly expanding the market.
Foster’s case for second hand: “There are many developers looking to capitalize on Pattaya’s potential in any way they can, so scrupulous investigation and educated-guessing about specific areas, buildings, and developers is essential to a sound pre-sale investment. While there are many trustworthy developers in Thailand, you never know exactly what you’ll get with a presale purchase until the unit is completed. Existing properties that are in good condition can offer a much lower-risk and more predictable returns.”
2. Pattaya has one of the highest land-appreciation rates in Thailand
As it is one of the most visited destinations in Asia, Pattaya has no shortage of tourism, which is great news for investors looking to achieve capital appreciation on their property. Constant tourism stimulates the economy to bring in more businesses and attractions, thus generates even more tourism and residential demand. Given Pattaya’s world-wide popularity, it has been a safe and lucrative place to invest for many years, and the time to buy properties there has never been better.
Foster’s case for second hand: “In a growing market like Pattaya, the land under the entire city will naturally appreciate, but it’s easier and more accurate to predict precisely where the highest rates in the city will be by looking at buildings and individual areas that have already data behind them.”
3. If you intend on renting out your property, Pattaya is one of Thailand’s safest markets
Investors who purchase property with the intention of renting it out as a holiday home can achieve great returns in touristic areas like Pattaya, where there is constantly a large demand for accommodation. Whether the investor is personally interested in what Pattaya has to offer or not, there’s a huge number of people who are, and will continue to be.
Foster’s case for second hand: “Instead of waiting for a newbuild project to be completed, buying into properties that are established allows you to start collecting rental income right away. The fact that you can buy second-hand properties cheaper than new build also lets you price your rental payments much more competitively, thus making your job of finding interested tenants so much easier.”
4. Pattaya offers something no other market in Thailand can offer: Everything.
Pattaya is unique in that it offers the widest variety of real estate options and opportunities in Thailand. As the country’s only true coastal metropolis, inner-city skyscrapers, beach-side villas, ocean-view high-rises, and peaceful suburban neighbourhoods can all be found in and around Pattaya. Appealing to investors of all kinds, this is variety that no other major market in Thailand can boast about. Whether an investor’s strategy involves purchasing a luxury villa that only requires one or two tenants per month, or purchasing multiple one-bedrooms that can attract new rental tenants every week, Pattaya’s market can provide the right property.
Foster’s case for second hand: “No matter what your investment strategy is, buying second hand will allow you to afford better properties of a higher quality for the same budget. This means you have a bigger selection at the time of purchase and may even wind up spending less than you expected.”
5. The AEC is coming, and it’s going to change everything; for the better
The ASEAN Economic Community has a goal of achieving economic integration for all of its participating nations before the end of 2015, and has established Bangkok as its headquarters. Whether this deadline is met or if it’s pushed back, the eventual AEC will cause an economic expansion that will benefit the entire nation. Bangkok aside, Pattaya’s close proximity makes it the next market that’s likely to be affected the most.
Foster’s case for second hand: “While Pattaya is still in a waiting period, the time to invest in properties that are certain to do well is right now. You know exactly what you’re getting with properties that already exist, which allows you to plan ahead with a well-thought out strategy instead of waiting to see what you get.”