3 Economic Factors Disrupting Bangkok Property in 2019

New Year, new start! …Despite the celebratory optimism that usually accompanies the start of a new year, property investors will have to grapple with some new realities in 2019!

Market conditions have shifted, especially when compared to last year early-2018; with headwinds and volatility in the horizon, smart money will need to tread carefully.

Knowledge is power, especially in Bangkok’s slowing real estate market. Therefore, understanding what will make the market move, is key to making winning bets in the uncertain year ahead!

Here are 3 Economic Factors to Watch in 2019:

1. Tighter Lending & Interest Rate Increase

Curbing Investment Enthusiasm!

The exuberant residential boom and rapid hike in condos and home prices in Bangkok, has inevitably raised concerns at the Bank of Thailand (BoT). Cautious, the regulator has raised its concerns about the excessive debt-fuelled growth of Developers and speculative attitude of local home buyers.

Therefore in an attempt to rein-in on the industry’s advance, the BoT has imposed curbs on mortgage lending. These restrictions will aim to limit property loan approvals, severely restricting 2nd home buyers. These new measures will be effective as from the 1st of April 2019.

On top of this, the BoT intent on stabilizing the market has approved a marginal increase of the policy interest rate to 1.75% up from 1.50%.

2. Thai Election & Market Uncertainty

Uncertain Market Conditions Ahead…

At the time of this article’s publication, the Thai elections that were initially scheduled for the 24th of February have been postponed. This hot-button topic has deep political and economic significance for Thailand and it’s Capital.

However no matter “when or how” the elections take place, the primary concern of the Bangkok’s real estate industry will be a continuation of stability and a peaceful economic and political environment.

3. The Global Economy, China and Tariff Man

The show to watch in 2019! “Washington-Beijing Relations” …

A slowing rate of Global Economic Growth is predicted for this coming year; with even the BoT reviewing 2019 projected growth for Thailand to 4% from 4.2% previously. While reasons behind this slowdown are complex, many are quick to point to one leading cause- “trade protectionism led-by cooling US-China Relations”.

On a local level, this uncertain outlook especially weakening growth in China could hit industries such as Thai Tourism particularly hard. This would have adverse effects on investor confidence and general market performance.

The big question, will Tariff Man strike again? …

When the Macro looks uncertain, focus on the Micro!

The macro-economic headwinds that the Bangkok property market will face in 2019, can easily encourage investors to stick their heads in the sand.

While this might not be a bad strategy, as the saying goes “In the midst of every crisis, lies great opportunity”!

Our advice is to diligently focus on micro-economic factors, carefully selecting popular Bangkok neighborhoods, in good quality projects, at an attractive (Highly discounted) sales price. This diligence will undoubtedly reap fruits and allow investors to weather the storm ahead!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Fresh Editorial

The Editorial Team is made up of Property Professionals with years of experience in the Bangkok Property Industry. Articles and reports are drafted using first-hand experience and local expertise!

The Team is always excited to hear from our readers via info@freshbangkok.com

5 Thonglor Residences Redefining Luxury Standards!

For anyone familiar with Bangkok, the Thonglor neighborhood needs very little introduction. The trendy residential hotspot has established a reputation as the Capital’s high-society hangout spot, with some even dubbing the area the “Beverly Hills of Thailand”. The popularity of this residential hotspot is a result of its wealth of amenities, from top-dining venues, hip-eateries, community malls, and independent cafes.…Read More

Senior Living Developments: Demographic Changes, Cultural Shifts?

In Thailand or in Asia for that matter, it is not “table talk” to bring-up the discussion of retirement and especially the cold hard truths associated to old age. It is often viewed as an immense sign of disrespect, to even contemplate sending elderly family members to retirement communities or nursing homes. Despite this deep cultural aversion, demographic and social…Read More

Fresh Investment Report: Bangkok’s Most Popular Rental Areas

Successful investments are always the result of reliable and accurate information. As a modest Bangkok Property Agency, investors often ask us to advise on: – Where to invest in Bangkok? – What are the most popular areas for renters? – Where do we complete most of our Rental Deals? In this study, we will aim to offer some unbiased and…Read More