Thailand’s Hat Yai Property Market Drenched: Floods Force Major Design Overhaul
- Severe flooding, the worst in 25 years, has devastated Hat Yai’s real estate market, causing a sharp downturn and a projected three-year recovery period.
- The crisis is forcing a major shift in property development towards flood-resilient designs, such as elevating ground floors, using water-resistant materials, and installing electrical systems above flood levels.
- Buyer demand has been significantly impacted, with a key demographic from southern border provinces deferring purchases and a new focus on acquiring land in higher-elevation areas.
Southern Thailand’s severe flood crisis derails Hat Yai’s real estate boom, prompting a major reassessment of development risk and infrastructure resilience.
The massive “great flood,” the most severe in a quarter-century, has inflicted extensive damage on the Hat Yai real estate market.
Projects located in low-lying areas were particularly affected, triggering a sharp market downturn.
Crucially, a significant cohort of buyers from the three deep Southern border provinces—Yala, Pattani, and Narathiwat—have deferred property purchases pending a full re-evaluation of flood risk.
Industry experts believe the crisis will permanently reshape future property development in the regional economic hub.
The new focus must be on flood-resilient design, which is already driving up demand for land in higher-elevation areas.
Market confidence in Hat Yai is projected to take approximately three years to fully recover, especially in locations known for recurrent inundation.
Billion Baht Damage and Strategic Shift
The disaster marks the worst natural calamity since 2000, causing over 1 billion baht in estimated damages to essential infrastructure, including roads, power, and drainage systems.
The residential sector has borne the direct brunt of this disruption.
According to Phattarachai Taweewong, director of Research and Communication at Colliers Thailand, Hat Yai held 128 active projects for sale, valued at over 41.5 billion baht, in the first half of 2025. This included 6,735 units in housing estates and 4,369 condominium units.
However, the recent flooding immediately inverted this positive outlook. Projects in vulnerable areas like Ban Pru, Hat Yai Nai, and parts of the city centre suffered severe losses.
Vulnerability of Single-Storey Homes
Single-storey detached houses were the most heavily impacted, with internal structures compromised and furniture and fixtures largely written off.
Extensive re-wiring and plumbing repairs have created a dual financial burden for both homeowners and developers.
“For apartment blocks, the ground floor was completely submerged. This has tarnished the image of several developments, leading to the temporary closure of communal areas, ground-floor flats, and car parks. Landlords who invest to let are now reconsidering their repair and operating costs.”
Phattarachai stressed that the crisis exposes the disconnect between Hat Yai’s rapid urban growth and its outdated drainage capacity.
He argued that future property must be “designed to manage water,” shifting the priority from mere aesthetics to practical resilience.
Recommendations include:
- Raising ground floor levels.
- Converting ground floors of apartment blocks into multi-purpose amenity spaces.
- Using water-resistant building materials.
- Installing electrical systems above recorded maximum flood levels.
Comprehensive city-wide improvements to canals and pipe networks.
Regional Demand Wanes
Hat Yai serves as a crucial residential hub for people from Yala, Pattani, and Narathiwat seeking second homes or accommodation for their children’s education.
This demand, previously strong enough to attract major developers like AP Thailand, is now on hold while regional buyers await new risk assessments.
Sales data for the first half of 2025 indicated a healthy market, with 70.7% of housing estate units sold. Intriguingly, commercial properties recorded the strongest sales, suggesting robust purchasing power among small and medium-sized enterprises (SMEs).
While overall demand remains, the need to mitigate “location risk” is now a paramount factor for buyers.
The Path to Resilience
Phattarachai concluded that Hat Yai stands at a vital juncture, needing to move from conventional development to a geological approach that seriously accounts for natural threats.
Flood-resilience measures must become the “new industry standard” for Hat Yai property.
This paradigm shift involves physical safeguards and the regularisation of flood insurance. While the flood has caused deep hardship, opportunity now lies in higher-altitude sites.
If all stakeholders—developers, city authorities, and residents—collaborate on a sustainable water management plan, Hat Yai is poised to recover and grow on a much more secure and durable foundation.
Source: https://www.nationthailand.com/business/property/40058739
