There’s no doubt that the year 2020 was one most of us would like to forget. As lightly as we’ve got off (so far) in Thailand, the lack of inward travel has severely limited the property market here. Having said this, property is still selling and November was actually a very good month for us as a real estate company. Many will say that the Thais are pushing the market at the moment, but 75% of our sales in November were to foreigners. This does give me great hope for 2021 as the country will be loosening its restrictions on inward travel and we can start seeing a sense of normalcy again.
Was 2020 really that bad for a lot of people?
As the pandemic is crippling the world, the Dow Jones has hit 30,000, and property markets in general around the world are flourishing. It’s a conflicting set of circumstances. People are forced to stay at home – away from restaurants, bars, malls – away from societal norms that have bled us dry of our hard-earned money for decades. How much income has the average still-employed European or North American saved in the past six months?
Previously unattainable savings have led to unprecedented buying in stocks, crypto, bonds, and property that have seen repeated record months this year in countries all over the world. But where do we go from here? Surely once the world reopens, speculation buying will go down and people will be selling off their newly acquired options and bring everything back to Earth.
My hometown of Ottawa, Canada has just seen July 2020 complete more real estate transactions than any July in the past 40 years, which is quite incredible given they’ve been in a state of lockdown flux since March with businesses closing, then re-opening, then closing again. It’s interesting to note that out-of-town properties are the ones selling more than anything else – no doubt with the fear of COVID lingering, social distancing is being taken to the ‘nth’ degree and people are choosing to upend from urban lifestyles to safer pastures outside city-centre.
I have friends in heavily locked-down areas in California who are also seeing their property values soar as the upper end of the property market continues to sell well. Blue-chip stocks and crypto have been making a lot of people a lot of money the past several months, and I believe smart investors know this won’t continue for much longer and are starting to put their money into bricks and mortar for a safer long-term gain.
My hope is this newly gained wealth in the upper-middle to upper classes will have some positive effect on us here in Thailand. I have several friends here who have already reaped the rewards of smart investment this year and are now taking advantage of the many good deals available locally in today’s property market. I know it’s a cliched adage, and any realtor will always tell you ‘the best time to buy is now’ – but I’ll say it – the best time to buy is now! Once travel starts up again, I guarantee the Chinese will be back in a flurry, followed by western travelers, and the increased demand will level off these price drops and we’ll start to see prices creep back up again. In the meantime, take advantage of these panic sellers – there are enough of them.
TAT is predicting 5 million visitors into Thailand in 2021. We can pretty much guarantee that at least half of these will be Chinese and probably 70% of those will end up in Pattaya. I’m certain after what’s been happening not only with COVID but with the political situation in Hong Kong where many mainlands wealthy Chinese bank, we’re going to see a great number of these visitors looking to hedge their money here and also looking for a property of their own to hunker down in for when the next pandemic hits.
No crystal ball in the world could have predicted what 2020 has brought. But with several vaccines about to go mainstream, I believe worldwide travel will really start to pick up by Q2 2021. For the sake of the poor local Thai economy, I certainly hope so. And for the rest of us, always onward and upward.
By Stu Sutton
Stu Sutton is managing director of Jomtien Property and has worked exclusively in the Pattaya/Jomtien real estate market for 16 years. Please feel free to contact him with any queries, compliments, or good jokes at 086 108 6575, [email protected] or visit Jomtien Property’s website at www.jomtien-property.com