A crackdown in Myanmar on the purchase of property abroad in a bid to halt a slide in the kyat currency has hit demand for condominiums in neighboring Thailand, where many Myanmar citizens have moved to escape turmoil since the military ousted an elected government in 2021, property agents in Thailand said.
Myanmar junta authorities this month took legal action against five real estate agents who bought and sold condominiums in Thailand, media in Myanmar reported. They were suspected of opening bank accounts abroad without the approval of the Myanmar central bank and transferring funds through illegal channels.
Myanmar citizens have this year risen up the ranking of foreign buyers of Thai property to second place, after only China, but news of the legal action in Myanmar has sent a chill through the market, one Thai-based real estate agent said.
“After the release of the news, sales went down. We’re all quiet, sales have dropped significantly,” a Myanmar citizen who works as a property agent in Bangkok told Radio Free Asia.
Myanmar’s February 2021 coup triggered a political and economic crisis after a decade of tentative reforms had raised hopes that the country was emerging from decades of repressive military rule.
Protests swept cities and towns until they were brutally crushed. Anti-junta insurgencies have spread in many parts of the country while the economy has stagnated and life for most ordinary citizens has become a daily grind of power cuts and water shortages.
The recent implementation of a conscription law as the army seeks to sustain its embattled ranks has compounded fears for many families.
For those who can afford it, a property abroad offers hope of a better life and many Myanmar citizens, including government officials, have been buying up condominiums in Thailand, property agents said.
“The political unrest in Myanmar has been the key reason for stimulating condo demand,” Vichai Viratkapan, acting director of Thailand’s Real Estate Information Center, told RFA.
According to data from the center, which is an affiliate of the Government Housing Bank, Myanmar nationals first surged up the list of main foreign buyers in Thailand in 2022, to third place, with 2.5 billion baht (US$69 million) worth of transfers.
The next year, Myanmar buyers maintained their third place with purchases of 3.7 billion baht (US$100 million). In the first quarter of this year, Thai condo transfers to Myanmar customers more than quadrupled to 392 units, worth 2.2 billion baht (US$60 million), compared with 76 units in the same period last year.
Another property agent said it was not just Myanmar people based in Thailand who were looking to buy Thai properties but Myanmar people from places such as Singapore and Dubai were also making purchases in Thailand.
Economic imbalances
Vichai said he expected sustained demand from Myanmar for Thai property but he acknowledged the recent action by the junta to prop up the kyat was likely to hit the market.
“It’s anticipated the curtailment on currency remittance would affect condo transfers,” he said.
The World Bank said in a recent report that Myanmar's economy faced significant challenges and would remain "feeble" as conflict, macroeconomic instability and dislocation constrained production. In the six months to March, goods exports fell by 13% and imports fell by 20% compared with the same period a year earlier, it said.
A senior Central Bank of Myanmar official, who declined to be identified, pointed to such imbalances to explain the fall in the kyat, which has plunged from about 1,350 to the dollar before the coup to around 4,600 to the dollar now.
The junta’s chief, however, has pointed the finger at unidentified “fraudsters” intent on economic ruin. Senior General Min Aung Hlaing told a June 7 meeting that people buying houses abroad with illegal income would be investigated and dealt with according to the law.
He might not have too far to look for people to blame. One Thai property sector participant, who declined to be identified, said so many families of top Myanmar military men had bought homes near the Thai beach resort of Hua Hin that the area had become known as “the generals’ village”.
A lawyer in Myanmar’s main city and commercial hub of Yangon said instead of hounding people wanting to buy homes abroad, authorities should handle the business transparently and earn appropriate tax revenues.
"Instead of arrest, prosecution and jail, sales should be done legally, with payment of taxes and registration,” the lawyer, who declined to be identified given the suppression of dissent in Myanmar, told RFA.
“It would help get revenue for the country and owners don’t need to fear arrest … such a win-win situation should be done.”
Edited by Taejun Kang.