As Thailand seeks measures to stimulate the economy and attract foreign investment, Deputy Prime Minister Phumtham Wechayachai has said that the government is working to increase the foreign ownership quota for condominiums from 49 per cent to 75 per cent and is also mulling to increase leasehold on a property for foreigners from 50 to 99 years.
The proposal comes after local property industry executives pressed for a change in the foreign ownership cap, saying demand from foreign buyers is on the rise. At the same time, high levels of household debt and tighter lending conditions have been affecting property demand by local buyers. Developers have grown more cautious as a result.
The Real Estate Information Center (REIC) reported a significant 19.7 per cent decrease in nationwide land allocation permits during the first quarter of this year, marking the largest decline in nine quarters. This adjustment by developers follows consecutive reductions in low-rise house transfers.The REIC highlighted that foreign ownership quotas for condominiums in popular destinations like Phuket and Pattaya are fully utilised across multiple projects.
Some projects have addressed the issue by reserving units in each condo project for leasehold contracts, with prices 10-15 per cent lower than for freehold units, as the majority of buyers were foreigners.In 2023, according to the REIC, the number of condominium transfers to foreigners reached 14,449 units, marking a 25 per cent increase from last year. The total value surged by 23.5 per cent to 73.1 billion baht, surpassing pre-pandemic levels.
Chinese nationals led in receiving condominium transfers, constituting 45.8 per cent of the total units and 46.7 per cent of the total transfer value, followed by Russians, Americans, and Myanmar nationals. However, many analysts believe that an increase in the foreign ownership quota for condos is unlikely to significantly impact the Thai property market or economy as very few condo projects have reached the quota.
