Foreign condo demand bounces, short-stay rentals tighten

· Thai Property Desk

Foreign buyers rushed back into Thai condos in Q2, even as short-term rental operations face sharper scrutiny. The year's first half still showed weakness, and Barcelona's decision to ban tourist apartments entirely raises questions about Thailand's own rental rules.

Foreign condo transfers jump 20% in Q2 despite H1 decline

Q2 foreign condo transfers reached 14.803 billion baht, up 20.2% year on year, with 3,292 units changing hands. The Real Estate Information Center under the Government Housing Bank recorded 145,140 square metres transferred. Chinese buyers led all nationalities by both unit count and value, though they recorded a decline from the previous year.

The first half picture was murkier. From January to June, foreigners took ownership of 6,533 units, down 8.8% year on year, with combined value slipping 1.5% to 28.267 billion baht. Foreign buyers represented 11.7% of all condos transferred and 21.7% of total value. The Real Estate Information Center linked the slowdown to weaker economic conditions in Thailand and abroad, prompting buyers to delay purchases.

American buyers paid the highest average per unit at 6.6 million baht. Indian buyers acquired the largest properties on average at 72.1 square metres. Across all foreign buyers, the average transferred unit was worth 4.3 million baht and measured 43.9 square metres.

Airbnb-style rentals face prosecution as enforcement widens

Renting a condo for stays under 30 days falls under Thailand's Hotel Act regardless of what platforms allow. Any property rented nightly or weekly for payment is legally defined as a hotel, with criminal penalties up to one year in prison, a 20,000 baht initial fine, and a further 10,000 baht for every day the violation continues.

Enforcement has moved beyond neighbourhood complaints. In late February 2025, the Interior Ministry launched a formal probe into Chinese nationals illegally renting Bangkok condominiums, with lockboxes containing keycards found hidden near motorcycle shops in Klong Toey. At a separate building, more than 250 units were being rented daily through platforms including Airbnb and Booking.com. By March, a Department of Provincial Administration task force had prosecuted four operations in Pratunam and Sutthisan districts, then four more in the Sukhumvit area, before extending south to Pattaya.

The workaround that holds up is straightforward: rent for 30 nights or longer, and the Hotel Act's threshold no longer applies. Longer stays also mean less turnover and less wear on the unit. Thailand's Parliament is reviewing amendments that could eventually allow condos to register for short-stay use without a full hotel licence, but nothing is in force yet.

Prima Realty joins LeadingRE to reach overseas buyers

Prima Realty International has joined Leading Real Estate Companies of the World, connecting Bangkok luxury property with qualified buyers across more than 70 countries. The Bangkok-based boutique agency specialises in luxury residential sales, leasing, investor sourcing and developer consultancy. Co-founder Prem Narula was awarded the Best Real Estate Agent Thailand Award at the Asia Pacific Property Awards 2022 to 2023.

Bangkok continues to attract international capital inflows and sustained residential demand. Limited supply of prime freehold land in the central business district, strong healthcare infrastructure, international education and favourable government visa schemes have reinforced Bangkok's position as a compelling luxury market. Demand remains strongest in established districts such as Phrom Phong, Wireless Road, Lumpini and along the Chao Phraya riverside, where buyers increasingly prioritise privacy, space, service standards and developer reputation over short-term pricing.

LeadingRE's global member network recorded approximately US$289.5 billion in home sales volume in 2025. The network facilitated approximately 17,500 member-to-member referrals, of which around 11,000 were successfully closed, generating approximately US$6 billion in referral sales and achieving a 60% conversion rate with an average sales price of approximately US$565,000.

Barcelona bans tourist apartments as rental costs spiral

Barcelona will not renew approximately 10,101 short-term apartment rental licences by November 2028, redirecting them to residential use. Barcelona mayor Jaume Colboni described residents' inability to afford local housing as a "major problem". Over the past decade, rental prices in Barcelona rose 68% and home sale prices rose 38%. In the most recent year alone, rental prices jumped 14%, making Barcelona the most expensive rental market in Spain and pricing out local residents.

The ban reflects a broader European pattern: other cities including Berlin, Lisbon and parts of Canary Islands have also banned or severely restricted short-term tourist rentals. London, Paris and Amsterdam instead cap the number of nights apartments can be rented each year. New York, Vancouver and Tokyo require owner-occupancy. San Francisco and Seattle limit the number of properties one person can operate.

Thailand has its own 30-day threshold, prohibiting short-term tourist rentals in condos. Yet thousands of units continue to operate illegally. Thailand is also debating government plans to allow foreigners to lease land for 99 years and increase foreign condo ownership from 49% to 75% per building. The Thai Hotel Association opposes the expansion, fearing it will accelerate short-term condo rentals and drive guests away from hotels toward cheaper condos without hotel standards.

Chinese school-district property premium reaches extreme levels

Chinese parents are competing fiercely to buy homes near top-tier schools to secure education rights for their children. In many Chinese regions, only property owners—not renters—can enrol children in local schools. Around 18 million Chinese children apply to primary school yearly, yet only 20% progress to university. The competition has driven property prices to extraordinary levels in top school districts.

Around Beijing's Zhongguancun No. 3 primary school, ranked in the top five of the city, property prices rose 31% year on year. In Shanghai, average prices in premium school zones have risen 20% annually. Estate agents routinely quote 115 million baht for two-bedroom apartments in these areas. Chen Sheng, chairman of China Real Estate Academy, says homes in top school zones are now seen as "widely recognised assets" with high market demand and strong investment appeal.

The Chinese government has attempted to moderate these prices through various policies: requiring five years of tax payments before purchase in some districts, adjusting school quotas to favour entrance exams over residential proximity, and compelling prestigious secondary schools to accept students from less-prominent junior schools. President Xi Jinping himself has acknowledged the problem, promising action on education inequality. Scholar Chen Jie from Shanghai Jiao Tong University notes these reforms aim not only to control prices but to address educational inequality by expanding opportunity across different socioeconomic backgrounds.

Work-from-home shifts buyer preference toward suburban homes

Work-from-home arrangements are reshaping Thai property demand, reducing the appeal of urban condos relative to suburban single-family homes. The Brand Inside podcast forecast that condos may no longer suit buyers prioritising home offices and space. Some property markets are expected to see price adjustments upward in areas served by newly completed rail infrastructure, though purchasing power remains a constraint given weak economic recovery prospects.

The decision to buy property now depends on factors beyond price, location and financing. Work arrangements have become as important as traditional metrics. Buyers evaluating properties must consider whether layouts support remote work, outdoor space and commute times to occasional office days—criteria that favour detached houses in quieter areas over high-rise city units.

Sources

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