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Japanese expat growth fuels demand
in residential rental market
As a result of increasing Japanese production activity in
Thailand, the number of Japanese expatriates continues to increase, fueling
demand for Bangkok apartments and condominiums for rent, according to
Theerathorn Prapunpong, Director of Residential Leasing Services at CB Richard
Ellis, the leading international property consultants in Thailand.
Japanese work-permit holders already comprise the largest group of work-permit
holders in Thailand. According to the Ministry of Labour, as of February 2008,
24,740 out of 122,262 BOI and temporary work-permit holders were Japanese,
roughly equal to 20% of the total.
The most popular residential locations with Japanese expatriates are Sukhumvit
Soi 21-55 in Bangkok. This area offers convenient access to a wide range of
facilities, including the BTS, expressways, supermarkets, hospitals, shopping
and entertainment complexes, as well as proximity to the Japanese school.
Supermarkets that cater more to the Japanese crowd include Fuji Super 1, Fuji
Super 2, the Emporium and Villa Market at J-Avenue.
When it comes to unit type, the tenant’s family size is the deciding factor. For
single tenants, a one- or two-bedroom unit in the region of 80 square meters is
sufficient, and budgets can range from THB 45,000 per month all the way to THB
75,000 per month if the person is an executive with a higher compensation level.
Japanese couples, even without children, prefer larger units, and these are
generally of the two-bedroom type, with floor space of around 100 square meters.
Budgets are in the THB 60,000-80,000 per month range, depending on the unit,
personal preferences, and spending limits.
Designs are quite important as Japanese tenants usually look for a higher level
of decoration and fittings, including wooden floors, high ceilings, built-in
closets and storage units, along with a spacious kitchen containing a large sink
and ample countertop space.
Units must include washing machines, four-burner electric stove, large fridge,
and a powerful water heater. However, a dishwasher is not necessary.
Required building facilities include a garden, children’s playground, and
exercise options such as a swimming pool or fitness center. A wading pool,
usually designed for children, is a plus. Also valued are Japanese language
capabilities or services and shuttle transportation to nearby BTS stations,
supermarkets, and hospitals.
“Also key is the presence of children-friendly facilities, such as ramps for
strollers, and other child safety precautions,” explains Noriyuki Matsuura,
Manager of Japanese Residential Leasing Services at CB Richard Ellis, a
specialized team that focuses on providing residential solutions for Bangkok’s
burgeoning Japanese community.
High-speed wireless internet services should exceed 2Mbps as this allows for
viewing internet TV. As for cable TV, the most popular package is the one that
comes with the NHK option.
Most Japanese children tend to go to the Japanese school near Rama IX Road.
Other international schools are not popular with Japanese children, especially
until high school (age of 15 or so). This is partly because it is essential for
Japanese children who want to pursue university in Japan to go to the Japanese
school. In line with Japanese investment in Thailand, the number of students
enrolled at the Japanese school has been steadily rising as well. The school has
grown from 1,759 students in 2001 to 2,401 students in 2007.
As far as contract terms, most residential leasing in this sector is done on a
one- or two-year contract. In two-year contracts, there is usually a
“diplomatic” clause that permits early termination in the event that the tenant
is transferred overseas for any reason. A 60-day notice period is usually
required in this case. In general, Japanese tenants are more likely to move at
the end of their lease period if they are not satisfied with the accommodations
and service at the property.
Apartments in downtown Bangkok enjoyed an occupancy rate of 90% in Q1 2008. No
new supply was completed during the quarter. Future supply expected for
completion in 2008 includes The Grand Sethiwan 2 housing 172 units on Sukhumvit
Soi 24 and the newly renovated Nithi Court comprising 14 units on Sathon Road.
CB Richard Ellis expects that demand, especially from Japanese expatriates, will
grow in line with or outpace supply, keeping occupancy rates well within the
87-93% range seen since 2000.
(Source CB Richard Ellis Thailand)
ABPC see continued growth in Pattaya
condo market
Seen here, Steve Carleton (left)
of Alan Bolton Property Consultants exchanges a sales purchase agreement with
Elyes Ben Brahim and his wife. ABPC welcomes Mr. & Mrs. Brahim to our wonderful
city and wishes Elyes continued success in his position as director of
operations for the Hard Rock Hotel Pattaya.
Alan Bolton Property Consultants confirm that despite the
“credit crunch” around the world people are still investing in the condominium
market here in Pattaya.
With the decline in value of the Thai baht people are getting excellent value
for their dollar, euro and pound. This along with the lowering of transfer taxes
and fees has stimulated a boom in sales and long may it continue.
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