Bangkok property sales saw a year-on-year decline of 4 percent last year.
A new report from real estate firm Plus Property revealed total Bangkok property sales of condominiums, townhouses and detached houses stood at 95,723 units during 2017, a 4 percent contraction from 2016.
Although growth was good in the first half of 2017, sales of detached houses continued to slow due to high household debt.
Going forward, the firm said Bangkok property sales of townhouses and condominiums will continue to grow, while momentum remains in the middle- and high-end sectors, especially for high-rise condos and townhouses in Bangkok’s suburbs.
Owing to easier commutes and better locations, consumers are increasingly switching their housing choices toward condominiums, with the buying group having expanded to include families and those nearing retirement.
Anukul Ratpitaksanti, Managing Director of Plus Property, said consumers remain unsure about the domestic situation at present.
This is especially true for the lower-price segment of the condominium market, which represents the primary type of supply in the market, he noted.
In addition to debt concerns, consumers are also deterred by tightening credit; it has become more difficult for loans to get approved.
Nevertheless, Anukul said the Bangkok property market is expected to grow at a pace similar to that seen during 2017.
Momentum remains in the middle- and high-end markets, especially for condominiums.
Those markets are expected to expand beyond the downtown area and into Bangkok’s suburban zones.
Sounding a note of caution, he added that the lower-priced condominiums segment that saw solid expansion five years ago, is expected to decline due to rising land prices and changes in urban planning in some areas.
Highlighting a new trend, he said a new market has been found in young investors who have had 3-5 years in their working life.
This group focuses on the lower- and medium-priced products, and prefer paying off down payments in installments.
The group view their purchases to save, and plan capital gains from reselling or from renting out their units.
Rent is used to pay installment, or used as supplementary income, Anukul concluded.