This year saw developers in the luxury residential segment compete strategically with their existing products while also coping with a changing resale market. Despite this, domestic stability allowed developers and investors to feel positive about the real estate market in 2017, according to experts.
Several luxury condo projects were completed during the 2nd half of 2017 including 98 Wireless, Magnolias Ratchadamri, and the Ritz Carlton Residences Mahanakorn which all made global headlines. The 3 high-rise projects all set unique price benchmarks and have likely changed the super luxury market in Thailand forever.
“The take up rate for 2017 luxury condos remains healthy due to limited supply and level of quality. Investors are particularly interested in Bangkok’s “Trophy Properties” the term refers to residences, architecturally or historically preserved properties that have extraordinary yields, with spectacular views, or other extraordinary amenities,” says Marciano Birjmohun, Associate Director at Knight Frank Thailand, to Luxury Society Asia.
Luxury condo units are popular with both domestic buyers and overseas investors. The latter group has been active in the luxury condo market since 2014 where they found attractive pre-sales prices for upscale developments. The units have seen significant capital gain, as much as 30%, due the land value increases in Bangkok’s CBD areas.
”A selection of the luxury supply has been launched by fairly new players on the high end market. These new players kept the momentum going and created a visible presence on the luxury condominium market. The banks of the Chao Phraya River, low to mid Sukhumvit road, and Sathorn remain concentrated areas for luxury supply due to connectivity, preferable neighbourhood infrastructure, and lifestyle amenities,” says Marciano.
This year was solid, but 2018 could be a challenging year for the luxury residential market as a large amount of supply will still be available. Developers are expected to focus on overseas activities since the uptake of overseas buyers has been increasing, according to Knight Frank.