The Pattaya property market continues to grow with more new projects launched this year the acquisition of sites by developers and planning of new developments. This is not only for condominiums, but also for hotels, retail and other developments, such as
CBRE has reviewed the sales statistics from December to February and found the impact of the political crisis to the Pattaya market has been minimal compared with Bangkok.
The Pattaya market has, in some ways, followed a similar development pattern to Bangkok. There is a limited supply of the best-quality projects in the best locations. The Wongamat location in Pattaya, like locations in central Bangkok, has done well, while the city condominiums in Pattaya, like those in midtown and suburban Bangkok, are starting to face an oversupply problem.
Pattaya has changed tremendously over the past five years. When Northpoint, the first Grade A luxury condominium launched in 2006, was completed in 2010 and Centara Grand Mirage Beach Resort Pattaya Hotel was opened in 2011, marking the new generation of five-star hotels, they signalled the commencement of a new era of the high-end market. These developments attracted upmarket visitors to Pattaya. The market has now grown to cater to different segments and different price levels. Before that, Pattaya was regarded primarily as a tourist market for entertainment and nightlife.
Pattaya has a wide range of demand from various sources. Being located two hours from Bangkok, an hour and a half from Suvarnabhumi Airport, and a short distance from the Eastern Seaboard industrial estates, it attracts Bangkok-based Thais wanting to purchase a second home, foreign buyers wanting a holiday home, and expatriate managers in the industrial estates wanting to rent a home, creating demand from buy-to-rent purchasers.
From our interviews with Thai buyers, one of the top reasons for buying a property in Pattaya is not only the convenience of its location and variety of amenities, but also the sea views. The fact that Pattaya building regulations still allow high-rise buildings on beachfront land likewise draws the attention of resort-home buyers who want high-rise, sea-view properties, which Hua Hin can no longer offer.
Pattaya continues to attract Thai purchasers, with more than 55 per cent of high-end condominium properties being purchased by Thais, mainly for use as second homes. Of the foreign investors buying condominiums in Pattaya, Russians dominate the market with a nearly 60-per-cent market share, while other nationalities, including Chinese, British, Kazakh, Australian, German, Dutch, Indian, American and others, comprise the rest of the market.
We still see a continuous flow of Russian and Chinese tourists to Pattaya, which will lead to more sales of resort homes. While Phuket, Samui and other resort destinations rely very much on high seasons, Pattaya seems to be able to sell all year around with different groups of visitors. There is not much difference between high and low seasons in Pattaya. In addition, long-term plans for new infrastructure projects, including U-tapao Airport for direct flights, have increased the potential for growth of Pattaya.
Average beachfront land in Pattaya city trebled in the past 10 years. This may not be as high a percentage as the prime sites in downtown Bangkok. However, we are all aware that prime beachfront land plots are becoming scarcer in Pattaya, especially in prime locations, such as Wongamart and Na Jomtien. Hence new developments have started to extend beyond early Na Jomtien to late Na Jomtien and Bang Saray.
I believe new developments, especially better accommodations such as five-star hotels and condominiums and retail developments, will draw higher volumes of upper-market tourists with higher spending power to Pattaya throughout the year. Investing in the property market today, it is not easy to speculate for short-term profit, but holding a selected beachfront, sea-view condominium in a prime location in a market like Pattaya is still a good investment option for future capital appreciation.