FIRST WITH THE NEWS: In what is the first Bangkok property research report to be released covering the Bangkok property and real estate market for Q3 2017, a rise in both prices and the number of unsold units in the Thai capital has been predicted.
It its Bangkok Times Q3 2017 report, real estate firm Edmund Tie and Company noted that the average take up rate for condominiums in the central business district (CBD) was just 55 percent in Q3 2017, a sizeable decline from the 72 percent witnessed in Q3 2016.
Average unit selling prices for new launches remained static at THB 250,358 per sqm during Q3,the report said, representing a minor increase of around 1.8 percent on a y-o-y basis.
The Resale Price Index increased to 162 during Q3 from 156 in Q2.
A total of 2,436 units from five new condominium projects were launched in the CBD during Q3 2017. All were within what the agency defined as being the luxury segment.
During Q3 2017 the number of condominium units in Bangkok grew healthily, it said, with the total number of new condominium launched during Q3 recorded as 2,436 units. This is more than double the 1,076 units released during Q2.
On a y-o-y basis supply during Q3 2017 also increased from 1,296 units during Q3 2016, an 87.9 percent increase.
The report said most of the Bangkok property units launched during Q3 were in the Central Lumpini area, followed by Sukhumvit and Silom/Sathorn.
Access to green spaces, luxury views and connection to mass-transit made Central Lumpini popular with developers and buyers.
Average pre-sale levels of proposed condominium projects in Bangkok’s CBD market stood at 55 percent during Q3, lower than the 72 percent take-up in Q3 2016 but similar to the previous quarter at 58 percent.
Average asking prices of Bangkok property resale condominiums increased to THB 134,500 per sqm, up just 3.9 percent from THB 129,500 per sqm in Q2 2017.
The agency reported there are a variety of new projects due to come into the market before the end of 2017. Among them are Ideo Mobi Sukhumvit 44 and Banyan Tree Residences.
With average take-up rates in the CBD for the year so far being 61 percent, the agency anticipates a reasonably large number of unsold units by the end of the year.
Developments that have been undertaken in suburban locations along future train lines can sometimes struggle to attract buyers, in part because of the competition among developers, the agency said.
“Without comprehensive market strategies, the stock in this sector will also begin to mount,” is said in what can only be a worrying note of caution to potential buyers.
The ample availability of land in suburban locations and, typically, more modest land prices attract medium and smaller developers – but sales rates can be lower in this part of the market.
Medium to large developers will typically look for prime CBD locations to avoid the risk of unsold units as demand still remains strong in these locations.
“We anticipate that CBD land will continue to increase in price as availability becomes increasingly challenging,” it concluded.