The market faced some challenges this year.
A combination of the country’s economic performance, rising development costs that are passed onto buyers and the introduction of the Bank of Thailand’s Loan-to-Value regulations all contributed to the lackluster appetite amongst buyers looking to dip their toes into Bangkok property.
As buyers are put in a weaker position, developers are left with more inventory and to shift this supply they will continue to incentivise buyers with promotions.
While this might paint a slightly bleak outlook it does create a window of opportunity for buyers looking to secure a bargain. In fact, this could be their time and now is the time to shop around! Coincidentally private sellers should hold tight and wait for stock levels to decrease unless they are in dire need to offload their assets.
Rising household debts have led to developers in 2019 to focus their attention on condominiums priced over THB 10 million knowing this segment tend to be cash-rich and not affected by the country’s economic performance.
Simultaneously there has been a rise in residential construction along the city’s mass transit line especially the city fringes as developers and investors alike look to capitalise on this future growth. Once complete in 2027, this infrastructure network will have 11 routes, 466.1 km of track and an impressive 297 stations illustrating the scope of the project.
Bangkok’s outer suburbs are traditionally the location for single and townhouses, and interestingly DDproperty has noted that there is an increased demand for these property types. The mass transit network allows people from Samut Prakan to come into central Bangkok with ease so could the passion for central Bangkok bolt houses be waning?
It is unlikely but market sentiment suggests that there is more choice for buyers than ever before. They are no longer tied to the city’s saturated areas of Sukhumvit and Sathorn as the city is opening up due to the BTS Skytrain and MRT.
However, there will still be demand for these popular and well-established areas as affirmed by DDproperty’s research that condominium supply in 2019 has been dominated in Wattana. Rather buyers now have the opportunity to branch out.
2020 is already seeing a shift in the market. Developers are building mixed-used schemes incorporating residential, commercial and retail to diversify their assets recognising the need to spread their eggs. Plus, the cabinet has approved slashing transfer and mortgage fees for properties under THB 3 million which should arouse some traction and get the lower end of the market moving.
Bangkok’s property market is still very much active, but now more than ever, developers and investors are advised to carry out their due diligence before parting with their cash to ensure a lucrative and long-term asset.
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