Recently launched condominium projects in Bangkok’s downtown areas performed strongly in the second quarter while those in midtown and suburban areas struggled, according to a new CBRE Thailand report. Projects that matched buyers’ expectations in terms of location, quality, design and specifications in the downtown and the midtown areas at the fringe of downtown recorded the highest sales rates during the second quarter.
CBRE Thailand added that the buyers of the popular projects were a mix of end users, speculators and buy-to-rent investors. Meanwhile, only a few midtown and suburban projects managed to sell out in a short period of time after being launched. Among these were The Monument Sanampao by Sansiri, The Line Jatujak-Mochit by BTS Sansiri Holding One Limited and AQ Aria by AQ Estate.
The midtown condominiums located in areas along the edge of downtown Bangkok and in locations close existing mass transit stations which allow for easy access to the city center had the highest sales rates, CBRE Thailand noted. However, many other midtown and suburban condominiums have been struggling with sales, especially entry-level to midrange projects launched during the second quarter.
As you get further away from the center of Bangkok, the worse sales numbers got. Projects located outside of the central area or along under construction or planned mass transit lines have taken even larger hit. The pressure from the large number of midtown and suburban condominiums expected to be completed this year, coupled with the lower level of demand due to tighter lending criteria, has contributed to the dip in sales in midtown and suburban areas.
CBRE Thailand stated that it believes overall sales will be slower in the midtown and suburban market for the time being. While developers may try to offer discounts or other incentives like free furniture packages, it is unlikely to significantly improve the situation. Developers will also focus on launching any new projects in the downtown market where performance continues to be strong, but it is doubtful that every project will be successful, the report concluded.
