Bangkok Condominium Market Half Year 2011

July 22, 2011 - PRLog -- The condominium market in Bangkok continued its period of consolidation in Q2 2011 following the frenetic activity of the second half of 2010, according to the latest report from Colliers International Thailand. Around 11,900 units were launched for the second quarter of the year, a 9.6% rise on the previous quarter. The launches were nearly evenly split between urban Bangkok and the suburban area and the targets were once again the affordability end of the market and mass transit lines.  

One key highlight of the quarter was the launch of Noble Ploenchit with 1,442 units being launched and around 700 units being sold out on the first day. Patima Jeerapaet, Managing Director of Colliers in Thailand believes that this was a big thumbs-up for the future prospects of the city. "The fact that the project was launched successfully during a potentially turbulent election period shows the resilience of Thai people", he said. Mr Patima noted that relatively small unit sizes and mostly one-bedroom configurations meant that even high-end projects are factoring in the need for affordability. "Developers in all segments are reducing unit sizes,in order to appeal to a greater potential demand", he added. Mr Patima also was pleased that Noble Ploenchit and the development of Central Embassy shopping centre will help fill the gap between Chit Lom and the beginning of Sukhumvit. "The eastern section of Ploenchit road has been a little bit of a no man's land for some time", he stated.

Other successful projects that were launched in Q2 include Lumpini Ville Pattanakarn - New Phetchaburi by LPN Development, which recorded a take up of more 70% of its 1,605 units in the initial launch period. The southern fringe was not left behind with Supalai showing an 80% initial take up for its Prima Rama 3 - Narathiwas project with a selling price starting at 56,000 baht per sq m. The mass transit system remained a strong factor in the market with projects within 200 metres of a station showing much higher selling prices and take up rates than those further away.

Whiles Colliers remain confident on the continuing growth of the condominium market, Antony Picon, Associate Director of research at Colliers noted a spot of caution. "With the number of projects in the process of construction coupled with looming minimum wage hikes, this could lead to increasing construction costs going forward", he warned. Growing inflationary pressures are also leading to further interest rate hikes and Mr Picon is concerned that eventually these will start to hurt borrowers. "You can only go so far and eventually borrowers will simply not be able to afford the repayments and although not a threat now it could arise if the economy overheats due to excessive spending", he added.

New launches for Q2 2011 increased by around 9.6% compared with Q1 2011with approximately 11,900 units hitting the market. This represents a continuation of consolidation in the market after the dramatic number of launches in the second half of 2010.

The average selling price in the City area is the highest at more than THB 130,000 per sq m, which is more than 45% higher than the average in Bangkok. The average selling price in the Eastern Fringe area came second due to a new project by a listed company in the area which had an average selling price of more than THB 120,000 per sq m.

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Colliers International Thailand - Experienced Real Estate Property Consultants in Thailand- was established through combining the resources of the global real estate services firm Colliers International, and Pasupat Realty Co.Ltd.