Downtown Bangkok condo market slowing

Bangkok condo market
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FIRST WITH THE NEWS: The Bangkok condo market was performing slower during the second quarter of 2017, according to new research released this week.

In its Bangkok residential Marketview report, real estate agency CBRE noted there were 1,041 new condominium units launched in the downtown area of the city in Q2, a decrease of 63 percent quarter-on-quarter but an increase of 8 percent year-on-year.

In the report, CBRE said: “Buyers in the downtown Bangkok condo market have become more selective and more cautious. Generally, sales rates have slowed and only projects with good locations at the right prices, and matching their target purchasers, have been doing better than average.”

The real estate firm said it is not worried about oversupply in the downtown area, saying there are 28,282 units under construction and that 76.9 percent of this future supply has already been sold.

“Based on reports from publicly-listed developers and CBRE surveys, we believe there only a small number of built-but-unsold units in the downtown area of Bangkok, with more than 50 percent of these units being in four projects.”

It did not name the four projects.

It said that record prices are being achieved in the Bangkok condo market, but not in all locations.

“We think that the price growth rate has slowed, particularly for projects which are not in the most prime downtown locations.”

During Q2, one “super luxury” project developed by AP Thailand, Vittorio, was launched with an average asking price of THB 350,000 per sqm. The project has 88 units and is located on Sukhumvit Soi 39 next to BTS Phrom Phong.

Sounding words of caution, CBRE said: “Our outlook for sales is that it will be slower, with buyers being more selective, especially for the most highly-priced products.”

Sales performance will be mixed, it added, but: “… we don’t believe that prices in the downtown area will drop, except for some completed projects with high unsold inventory.”

In common with other recent research, the agency said that increases in land prices means that new projects will have to charge higher prices versus those at previously launched developments.

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