Bangkok’s super prime and prime condominium market has been one of the lone bright spots for Thailand’s flagging property market. According to research from Knight Frank Thailand, this segment accounts for less than five percent of the total Bangkok condominium supply, and sales at these projects continues to be strong since most developments are located in the city’s most desirable locations.
With land in the Bangkok CBD area scarce, condominiums in the super prime category featured rapidly increasing selling prices for recently launched projects, especially when compared to lower-end Bangkok condominiums. Knight Frank Thailand noted that the prices for super prime units rose from THB303,250 per sqm. at the end of 2015 to THB319,095 per sqm. at the end of the first half of 2016.
The selling prices for prime condos recorded similar increases during the same period. Several yet-to-be-announced prime projects are currently in developers’ pipeline and Knight Frank Thailand is predicting that the average selling prices will continue to rise. This is in spite of Bangkok’s real estate market showing signs of slowing down during the rest of the year.
It was not all good news, however. The research revealed that the sluggish economic climate in Thailand is starting to have an effect on the upper-end of Bangkok’s real estate market. Developers have begun to delay or postpone the launch of new flagship projects. A great deal of newly acquired prime land by developers, which had already been cleared and is ready for construction, is currently sitting.
Lowered consumer confidence and mild deflation have contributed to reducing unit take-up numbers and threaten to impact demand. It was also noted that the high-end condominium market could be a target for speculators with a number of yet-to-be-completed units already being listed on the resale market.
Despite the potential risks, Knight Frank pointed out that Bangkok’s super prime and prime market is not yet oversupplied and continues to outperform other segments of the city’s condominium market.
