According to recently released data from Colliers International Thailand, the condo market in Thailand recorded a bit of a stumble in the third quarter with several key performance areas trending downward. When compared with the second quarter of this year, new launches, take-up rates and price per sqm. all decreased in the most recent quarter.
Launches were down significantly q-o-q with about 40 percent less taking place over the past few months. Most developers were still unsure of the market situation and decided to postpone the launching of new projects to the fourth quarter or sometime in 2016, Colliers International Thailand reported.
Nearly 80 percent of those projects that were launched in the third quarter are in the THB50,001 – 100,000 per sqm. price range. Colliers International Thailand also noted that 38 percent of projects launched in the most recent quarter were from developments along mass transits lines and they believe this is a trend that will continue to grow. Many developers are currently search for plots of land near existing and future mass transportation locations to take advantage of the demand for these types of properties.
In an attempt to attract new buyers, many developers revealed new marketing campaigns to entice consumers. Free transfers and a waiving of mortgage fees for all ready-to transfer units were just some of the ways they attempted to drum up interest. A lot of these promotions continued into the fourth quarter as well.
Colliers International Thailand pointed out that one of the biggest problems that faced developers in Bangkok during the third quarter was the inability to transfer units to buyers. The bank rejection rate rose to 30 percent with a majority of the loan rejections coming in the mid- to low-level segment of the market. This made it impossible for many buyers to complete the transfer process.
There is hope on the horizon. The real estate consultancy believes the recently passed government stimulus measures will boost demand in the condominium and housing markets as well as help all developers that have completed units in their stock. It’s unknown if the benefits will be seen in the fourth quarter but should certainly be noticed by the first quarter of next year.
