One top Thai property developer recently made a valid case for a 5 percent to 10 percent price rise for Bangkok property and real estate before the end of the ear.
LPN noted that with the recent rise in the legal minimum daily wage, and the fact that land prices are also rising, these facts will have an undeniable effect on Thailand’s property and real estate sector
Opas Sriparak, the Chief Executive Officer and Managing Director of LPN, told media: “When the minimum daily wage increased by 5 per cent, it affected construction costs by about one per cent. Land price have also increased by more than 10 per cent this year compared with last year, following the government’s planned infrastructure projects.”
He said that combined impact will see residential prices increase by up to 10 percent, depending on location.
Providing interesting facts from this business, he said: “Normally, demand for residences priced at not more than THB 1 million accounts for an average of 30 percent of the total residential projects in the market during any year.”
“But since last year, demand in the lower-income market has dropped by more than a half. As a result, the property market cannot register growth even though the demand in the middle and upper-income market – those who buy residences priced at more than THB 2 million per unit – still exists. But it is limited,” he said.
Responding to current market trends, LPN has changed its target customers from lower-income to the middle- and upper-income market.
They’ve done this by launching residences priced at more than THB 2 million per unit.