By Andrew Batt:
Hua Hin has retained its attraction as a second home destination for Thai property buyers, with overseas buyers making up just 25 percent of all condominium sales.
According to Knight Frank property buying activities in both Hua Hin and Cha-am are as busy as ever, with most buyers being Thai nationals from Bangkok.
Surasak Limpa-arayakul, Director of the Research and Valuation Department of Knight Frank Chartered (Thailand) Co., Ltd. revealed that the total condominium supply in Hua Hin during the first half of 2012 was 17,349 units. This figure accounts for the units that have accumulated from 2003 to H1 2012.
He said that more than 75 percent of Hua Hin condominium buyers are Thai, especially those from affluent Bangkok-based families. There are also some expatriates and foreign retirees who have bought beach condominiums. The reliability and reputation of the developer tends to be the most important factor for expatriates, while an affordable price seems to be vital for foreign retirees.
Surasak explained that foreign buyers, unlike those in other tourist destinations such as Phuket or Samui, are mostly retirees or those with Thai spouses. They have a limited budgets and prefer to buy a residence for their own use as a second home during their country’s winter season.
As foreign ownership regulations in Thailand have become more stringent, foreigners who are looking for a residence are paying more attention to condominium units that they can buy on a freehold basis (up to 49 percent of the total ownership). Thus, they are likely to search for an inland condominium unit that has a lower price than a beachfront unit.
The historical unit take-up during the peak year for Hua Hin condominiums has been about 1,000 to 1,200 units per annum, however during the first half of this year there were about 1,655 units sold, according to Knight Frank.
Unfortunately, with the influx of new supply, the growth in demand cannot keep up – causing the take-up rate to drop from 45 percent in 2011 to 44 percent during the first half of 2012.
Previously, condominiums in Hua Hin could be sold easily, especially those in beachfront projects and/or projects that have sea views from the units. Recently, the inland condominium market in Hua Hin has garnered interest, with compact sizes and affordable unit prices dominating.
The cumulative average growth rate (CAGR) of beachfront condominium units in south Hua Hin was at 4.2 percent between 2010 to H1 2012, with an average selling price of THB 138,010 per sqm.
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