Simply because Thailand is the 2nd largest economy in Southeast Asia with a relatively stable political environment as well as healthy economic exchanges with China. Besides, the real estate price is comparatively low and there’s a convenient transport system everywhere. Thailand though is still a developing country; it is undergoing rapid urbanization with a present population of 64 million. The country’s foreign exchange reserves rank 13th in the world while reaching 183 billion US dollars that apparently surpasses the economic powers of the United States, United Kingdom, and France.
Considering the facts and figures, China’s investment in the real estate in Thailand has reached a greater height. Why such influx?
Capital Control
Ever since China’s capital outflow control has lessened its overseas investment in housing, the capital flow has redirected to markets such as Thailand that is relatively less costly. Moreover, investing in Thai real estate doesn’t need a huge capital outlay. Hence effectively mitigating the investment risks.
But then of course, if you are considering a luxury stay in downtown Bangkok, it is likely that the prices have already passed the THB350, 000 per square meter mark that is equal to around 70,000 yuan per square meter.
Significantly, the Thailand housing industry is robust and thus experiences a gradual increase over the year plus being able to provide rental returns, averaging 5-8% per year. These conditions make it favorable and attractive for the investors from China.
China’s One Belt One Road Policy
The Chinese government supports investment in the countries, which participate in the “Belt and Road Initiative.” This type of investment is in line with China’s strategy of increasing the count of new infrastructures in its neighboring countries while encouraging cross-border trade activities in the same region.
Moreover, the convergence of 3 railways will make Thailand the hub of transport of Southeast Asia. It is for the first time that the high-speed rail link connects Vietnam, Cambodia, Malaysia, Singapore, Laos and Thailand and China with Kunming. Thus, many Chinese believe in investing in the real estate of the “Belt and Road” countries, which is seen as a blessing from the government under the development boom.
Chinese Travelling Overseas is Willing to Grow
The first-time Chinese investors prefer to make their first investment in Thailand because of its proximity to China, reasonable housing prices, acceptable culture, and well-developed tourism infrastructure. Though at present, 9% of Chinese citizens have passports, it is expected that the figure will double in 2020 by 240 million people.
