As we draw towards the end of 2020 and look back on what has been a challenging and unusual year across the world, the Thailand property market Index has also endured a bumpy year.
The market has been contracting hand-in-hand with the economic slowdown and burgeoning household debt. The Bank of Thailand’s new Loan-to-Value regulations requiring higher deposits has made it harder for buyers impacting the market too.
This dip has, however, created a window of opportunity for investors in a sound financial position. As developers hurry to offload inventory through promotional campaigns and offers, buyers can relish in lower prices especially of condominiums. Price wars between sellers have become common, and those not desperate to sell, are urged to delay their sale until a more attractive time in the market.
Condominiums are not the only property type to have been hit. Townhouse prices have taken a downwards turn too creating even more competition for condominium sellers.
The arrival of Covid-19 was another curveball that the market could not have predicted. The pandemic has left many people without the required financial security to invest in property, giving them little choice than to give up hopes of securing a home. At the same time, there is a continued demand for property out of Bangkok’s CBD with a real thirst for landed homes in the suburbs.
After the lockdown eased, property prices declined. Developers are partly to blame as their urgency to sell propelled price wars, but this blip ironed out as new launches in Q3 2020 helped encourage prices upwards again. Data collected by DDproperty recorded a price increase of 2% from the previous quarter to 201 points, the first recorded increase since Q1 2019.
Other glimmers of hope for the market include single-detached houses prices increasing by 3% in the third quarter of 2020, while condominiums experienced a 1% increase but townhouses headed in the other direction decreasing by 1%.
Buyers have naturally delayed purchasing property due to economic uncertainties leading to increased supply in Q3 2020 by a staggering 23% to 385 points. A fair share of this property is condominiums representing 88% of Bangkok supply with the highest supply focused in the Wattana District, also the neighbourhood for the highest townhouse supply too suggesting that living in Central Bangkok may not be as appealing in 2020 as it once was.
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