By Andrew Batt:
Last year saw fewer launches in Bangkok’s Central Business District condominium market according to new research from DTZ in its quarterly Property Times report.
The number of new launches in the fourth quarter of 2012 was 1,900 units, outpacing the 1,700 seen in Q3. But despite this, the total number for 2012 – some 6,400 units – was 7.5 percent down on the 2011 figures. DTZ noted that several project launches that were slated for launch in the final three months of 2012 were held back amid concerns of low purchasing activity over the festive period.
Notwithstanding, the toned-down anti-government rally and non-resurgence of floods boded well for homebuyer sentiment. Overall take-up for launches in Q4 stood at 53 percent, whilst that for the entire year stood at approximately 58 percent.
Sales activity was not uniform throughout, but rather sporadic depending on quality and location. Certain projects were able to achieve 80-100 percent sales within weeks of launch. Healthy sales activity was also witnessed in the resale market, particularly for projects that are close to mass transportation and major landmarks or amenities.
Capital values for CBD resale condominiums in Q4 rose 0.7 percent quarter-on-quarter and 1.7 percent year-on-year to reach an average of THB85,200 per sqm.
Major new project launches in the fourth quarter of 2012 included Circle Sukhumvit 11, Nara 9, Menam Residences and The XXXIX. The XXXIX, located on Sukhumvit 39, was the only super luxury project launched during the quarter with average prices exceeding THB200,000 per sqm.
The take-up level for this project was strong, reflecting the rebounding demand for superior projects located in prime neighbourhoods in Bangkok. Unlike previous quarters where new launches were mostly concentrated in Sukhumvit, new launches in Q4 were mainly found in the Silom-Sathorn zones – accounting for approximately 57 percent of total unit launches.
The continual launches of new projects in the CBD will make project sales more competitive, particularly those in the price range of THB80,000 to THB130,000 per sqm which form the bulk of new launches. Homebuyers are becoming increasingly discerning and proximity to mass transit stations will continue to be the primary selling point for the wider consumer group.
DTZ noted that, looking forward, resale price growth will be uneven with projects commanding good accessibility and convenience factors enjoying greater price appreciation. Developer reputation will also play a bigger role among purchasing considerations particularly for CBD condominiums.
The announcement of new mass transit lines will bode well for the urban expansion of Bangkok, widening opportunities for developers as well as expanding the home ownership ratio of residents. The construction completion of expansion lines such as the Purple and Dark Blue mass transit lines will help lift prices of condominiums in suburban Bangkok.
Andrew Batt, International Group Editor of PropertyGuru, wrote this story. To contact him about this or other stories email andrew@allproperty.com.sg
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