The Expected Impact of the Asean Economic Community on the Real Estate Market in Thailand
Since its formation the organization has always looked upon the need of the member countries in field of real estate, loans and services of strategic importance.
It also provides a platform to all the member countries to ensure that disputes are settled in a peaceful manner and the peace in the region is maintained.
Thailand is a part of ASEAN and Thailand’s real estate and property market is considered one of the major business sectors in the kingdom, hence many, not to say most, people in the real estate sector hold their breath awaiting the impact the Asean Economic Community (AEC) will have on Thailand’s real estate market.
The property market is undoubtedly expected to go up with the birth of the Asean Economic Community in 2015.
Despite the tough turbulences in 2010, Thailand recorded some of the highest property investment sales, thus showing how confident investors are in Thailand’s property market
The property market is categorized into 5 sectors; industrial, residential, commercial, hospitality and retail.
However, when the property market is discussed, the perception in the minds of most people is the residential market.
The impact of the Asean Economic Community (AEC) on Real Estate development in Thailand.
If we therefore take a look at the impact that the Asean Economic Community (AEC) in 2015 will have on the property market, there most certainly will be a huge impact on all sectors of the real estate including transportation and logistics.
Thailand being at the center of the many AEC member countries will definitely have a larger distribution network.
The construction of sufficient residential estates to provide the new investors with housing will also be commenced.
This may make the public anxious at first that there will be an oversupply of condominiums; however, this oversupply will afterwards be met by demand once the AEC is executed.
The AEC is set for the introduction of a single market and a production base through the free flow of goods, services, infrastructure, capital and skilled labor in all he AEC member countries.
This will have a positive impact on real estate because by simply looking at the impact that free trade common markets have on the development of larger economies, for example America, one can conclude that introduction of the AEC will positively impact development in Thailand.
Thailand’s low cost of living, solid human resource and its strategic position to the rest of the world will attract a lot of companies and investors to either expand or base their businesses in Thailand.
The immediate impact of this revolution will be an increase in demand for both commercial and factory spaces throughout the country.
A substantial increase in demand for real estate to offer both shelter and working premises in Bangkok, its surrounding holiday beach towns and the Eastern seaboard will also be realized.
This is because the staff from multinational companies will need housing that matches their standards.
How the AEC will revolutionize Real Estate in Thailand
Since the AEC will open up Thailand to all investors in the Asian region, higher standards of property management will be applied.
The AEC will definitely lead to an influx in the number of savvy new executives who will desire to live the best kind of lifestyle that money can afford.
This means that the buildings that will have the highest levels of management and a sense of community will have the highest executive demand.
Management that ensures that their buildings do not overflow with people on one hand and are not empty on the other hand, with units that sit vacant, will definitely win the favor of the executive staff.
The only way that the above can be perfectly implemented, will be by ensuring that the people who live in these buildings are the owners.
Where residents are the owners of the building, they will not only ensure that the building is used for its intended purpose, but also comment on what they feel is wrongly done.
This is because the building is not just an investment that they have made, but will also be their home in Thailand.
This is what has led to the high quality maintenance of buildings such as the Saladaeng and Ficus lane residences in Thailand.
Now we at TEN Thai Estate Network figure that the ASEAN member countries will try to pressurize the Thai government to liberalize the foreign property ownership laws preventing foreigners from owning land in Thailand.
The Impact of the AEC on Thailand’s Real Estate Investors
When the AEC will be fully implemented, investors in Thailand will also be interested in expanding their property markets to other countries.
For example, the opening of Myanmar’s economy has recently been attracting more investors.
Thailand investors may also not hesitate to expand their investments to other countries.
Investors from Thailand may be interested in either purchasing already built homes or acquiring land to develop property.
Thai investors have actually been seen purchasing UK and other foreign real estate properties.
Thailand’s luxury development organizations such as PACE, have also begun maintaining high standards in the area of property development.
This is in a bid to attract more foreign investors and tourists into Thailand’s open market.
There is no doubt that if Thailand liberalize the land ownership laws, then Thailand’s tourism sector will see an explosion and realize they should’ve done this ages ago.
As discussed, it is beyond reasonable doubt that Thailand’s real estate market will grow magnanimously after the full execution of the AEC on the 31st of December 2015 and investors are expected to flock here in droves to invest their hard earned money – especially if and/or when they can own land in their own name.