Thai developers step up sales pitches as Hong Kong,China investors show increased interest
An increased interest for Thai properties from Hong Kong and mainland Chinese investors has compelled Thai developers to increase overseas road shows
With Hong Kong and mainland Chinese investors showing increasing interests in properties in neighbouring countries including Thailand, a popular travel destination, Thai developers have stepped up their sales pitch with more frequent overseas road shows.
Sansiri Public Company, one of the top three property developers in Thailand, has been capitalising on the uptrend, marketing new residential projects in Hong Kong almost every month.
The company said 100 units of a downtown Chiang Mai project that was marketed in June were snapped up within a weekend.
“Hong Kong is our biggest overseas market,” Sansiri president Srettha Thavisin told the South China Morning Post. “I think Hong Kong people like us because it’s [Thailand is] only a two-hour flight [away], and prices are much cheaper.”
Thavisin said Hong Kong had contributed 10 per cent, or HK$350 million to Sansiri’s total sales in the first half, while mainland China was their fastest growing market.
On the Chinese property portal Juwai.com, Thailand ranked third place in the first-half of 2017 in the number of real estate purchase inquiries from Chinese buyers, up from the sixth position last year.
Riding on such interests, Sansiri is opening up sales offices in Shanghai, Guangzhou and Shenzhen in the next two weeks, in addition to its existing Beijing office.
In Hong Kong, it is planning a big promotional event in Lan Kwai Fong at the end of the year, but has declined to provide details.
About 70 per cent of Hong Kong buyers are investors, according to Sansiri, and mid-level priced condominiums ranging from HK$1 million to HK$3.5 million are most popular among these buyers.
The company said these investments could bring a rental yield in Bangkok of up to 7 per cent, adding that resort properties in Phuket and Pattaya were also gaining interests among mainland Chinese in search of a second home for leisure use.
Another opportunistic developer keen to ride on the uptrend has even chosen Hong Kong to launch a luxury property project for sale for the first time.
Nirvana Daii, which is listed on the stock exchange in Thailand, brought its latest residential project Banyan Tree Residences Riverside Bangkok, located along the Chao Phraya River, to Hong Kong on July 20, ahead of a launch in Thailand, to give Hong Kong investors the first pick.
In Hong Kong, “even a parking space can cost you millions of dollars,” said Amous Lee, CEO of Fanss MORE, the agency for the Banyan Tree project, adding that freehold and no punitive stamp duty for foreigners are selling points of Thai properties.
“I think demand for high-end Thailand properties is very strong, ” said Sornsak Somwattana, chief executive officer of Nirvana Daii.
With prices starting from HK$5 million, or HK$6,500 per square feet, Somwattana said the units were more affordable compared to properties in Vietnam or Malaysia, given their location.
The developer aims to use up the 49 per cent quota – the percentage of units that the Thai government allows of the project to be sold to foreigners, with Somwattana expecting Hong Kong buyers to contribute to about 20 per cent, followed by mainland Chinese and other Asian investors.
The average price for new condominium projects in Bangkok has risen by around five to 10 per cent annually in the past few years, and it will continue to increase in 2017, according to the latest report by Colliers.