The Thai real estate market in 2025 appears to face challenges from all directions. These include a slowing economy, declining purchasing power, stricter lending criteria from financial institutions, and immense household debt. As a result, the real estate market has started the year with a less vibrant atmosphere than expected. We’re also seeing a surge in marketing campaigns featuring discounts, giveaways, and promotions right from the beginning of the year.

The recent move on March 20, 2025 by the Bank of Thailand to relax the Loan-to-Value (LTV) regulations for housing loans and related mortgages. That move allows property buyers at all price levels to borrow 100% from financial institutions without conditions, regardless of whether it’s their first, second, third, or fourth property (previously, only first homes or condos priced below 10 million baht were eligible for 100% financing). Despite the move, we must still keep a close eye on the real estate market’s direction this year. This is particularly important given the context of a slowing economy, declining purchasing power, and soaring household debt.

Many sectors still view the Thai real estate market as having opportunities and a positive direction for growth, as there remains a housing demand. For instance, DDproperty.com sees this year as a year of opportunity and a positive trend for the real estate market. They identify four key highlights that represent hope and opportunity for the real estate business, as follows:

1.Stronger rental demand

Based on the platform’s user data collected over the past eight months (July 2024 – February 2025), the data show that 52% of users chose to rent real estate, while 48% chose to buy. The proportion of those buying for personal residence and for family combined was 54%, while those buying for investment accounted for 47%, which is a relatively close ratio. This indicates that the investor group is quite large, partly due to the perceived worthwhile returns from both short-term and long-term rental investments.

2.Prolong real estate purchase decision from the Thai local 

Due to the slowing economy and declining purchasing power, coupled with high household debt, Thais are exercising caution in their spending. They are managing their finances carefully and taking a longer time to make decisions, especially when it comes to property purchases like homes or condos. Notably, one in three Thais are postponing their real estate purchases for the time being, while one in four are seeking properties at lower prices. This reflects that affordability is becoming an issue.

3.Detached House and Condominium at 1 to 5 million baht are in demand

Despite current economic conditions, there’s still a significant demand for homes and condos among Thai people. Many are looking at properties priced beyond their actual affordability. Specifically, the most popular price ranges are:

Townhomes: 3-5 million baht (64% of buyers)

Condominiums: 1-3 million baht (46% of buyers)

Detached Houses: 3-5 million baht (30% of buyers)

4.Condominiums in Bangkok and Phuket are leading in demand

Condominiums in Bangkok and Phuket are highly sought-after. Both areas are major real estate markets and are popular choices for residential purchases, particularly in the condominium. However, other provinces like Chiang Mai and Chonburi also show strong demand for residential properties.

Thailand’s real estate market in 2025 presents interesting opportunities across three main segments:

1. Residential Market: There’s a growing demand for small, affordable apartments, driven by the increasing number of single-person households. This trend has risen significantly from 6.4% in 2012 to 26.1% in 2022. Developers are adapting by focusing on smaller residential projects that cater to working professionals and foreigners.
2. Industrial & Alternative Investments: Investors are showing increased interest in this sector, particularly in industrial estates, data centers, and healthcare facilities. Developments in logistics and infrastructure are also attracting attention.
3. Luxury Market: Luxury real estate prices are expected to rise by 3% to 7% annually, fueled by demand from both domestic and international buyers. Prime locations such as Bangkok, Phuket, and Pattaya are expected to lead this growth.

While Thailand’s real estate market in 2025 will face numerous challenges, opportunities for growth do exist within these difficulties. Businesses that adopt effective strategies, demonstrate agility, and deeply understand their target customers will be able to achieve growth under the current economic turbulence.