Property markets are cyclical experiencing ups and downs depending on economic factors. Recent research from DDproperty has indicated that Bangkok’s residential property market is currently in a sluggish stage.
A continual stream of supply since the beginning of the year, new Loan To Value regulations tightening the belt of investors looking to buy a subsequent property and burgeoning household debt are all cited as reasons for this. Coincidentally this has led to the DDproperty Price Index, used to illustrate seller optimism and anticipated achieved sale prices, remaining static for the third quarter of 2019.
At the same time, the Price Index for condominiums has also remained the same. This is the first time there has been no change in this index for the last ten consecutive quarters. Single houses have however slightly increased by 1 percent, a knock-on effect of the extension of the city’s mass transit lines which have pushed up values but at the same time, townhouses have decreased.
These figures could suggest that there is an increasing desire to live in single houses over other property types. Previously the condominium market performed well in part due to their central locations. Bangkok’s residents wanted to live closer to work to avoid a lengthy and unpredictable commute to work and lateral living condominiums perfectly filled this void. Those who could afford to would invest in a city bolt hole to stay during the week in addition to a house in the suburbs.
However, the extension of the mass transit network has changed this. It is now possible to live in a house and have access to a reliable and efficient transport means. This current market blip can certainly be attributed to macroeconomic factors and a glut of supply, but looking ahead it will be interesting to see how many the condominium and single house market fair, and whether those living in the vicinity of the mass transit line use it.
Nevertheless, the weak market does create a window of opportunity for buyers looking to secure a property now. With a big choice in available units and developers keen to offload inventory, sellers are well-positioned to take advantage of this to secure a lower asking price. Developers have already been responding and offering various promotions to entice in purchasers, suggesting it really is a buyer’s market.
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