Bangkok condominium will be in the stage of fierce competition in order to attract the buyers since the buyers have eyed on resort residential projects in order to escape the Bangkok flood in the next coming year, said Mr. Phanom Kanchanathiamthao, Managing Director of Knight Frank Thailand.
Condominium buyers mostly buy for their own occupation rather than speculation. The supply of condominium as of the third quarter of 2011 was 253,744 units, increasing by 2,417 units during the third quarter of 6 projects. In the third quarter, there was a premium grade condominium added to the supply of Bangkok condominium supply. New supply has been slowed down after the dramatic number of launches last year.
Ms. Risinee Sarikaputra, associate director of Research and Valuation Department of Knight Frank has revealed that the supply in the peripheral area of Bangkok contains the lion’s share of units. This quarter, all supply in the peripheral area was located on Chaengwattana Road. There were a few projects in Chaengwattana which have postponed the launching due to the flood, however the projects will roll out next year. Surprisingly, there is one premium grade condominium launching this quarter, the project is located at Soi Thong lo, developed by Major Development Group.
The overall take up rate has increased from 45.8% in the first half of 2011 to 47.2% in the third quarter of 2011. However, the unit sold has decreased from 14,907 units to 1,140 units.
Ms. Risinee pointed out that the overall condominium price has been increased by 2.5 per cent in the third quarter of 2011. The difference between the selling price of condominium in the city fringe area and the city area became closer due to the selling price of land in the city area is very high since the land price is the major cost of development cost.
Source: Knight Frank Thailand Research and Consulting Department
Mr. Phanom concluded that the new supply from the last quarter of this year to next year will climb up in the city fringe area due to the purchase of land from listed companies reported by SET. Next year will be the year of big developers such as MBK, LPN, Asian Property, Quality Houses, Land and Houses, Supalai, Ideo, Pruksa, Noble, SC Asset, G Land Canal and Sansiri. There are also the new developers who are in the construction industry so they will be able to control the construction cost such as Siamese Estate, Pre-built. The condominium market will be in the stage of cost controlling, thus it is difficult for small developers to enter the heat period next year. Many listed companies have also shifted to resort destinations such as Hua Hin, Phuket, Samui, Pattaya. TCC Capital Land has seen Pattaya as a potential area for developing the residential project.
The fabulous area of new launching will be in the intersection of Ratchada-Rama 9 due to many mega projects will be launched, the construction of two office towers by G Land Canal Public Company Limited, together with the completion of Central Rama 9 which will be consisted of retail and office spaces in this area. Thus, many developers have acquired the land plots in this area and plan to develop in the new coming year. However, we will see the big amount of supply being launched by the end of this year since the projects have postponed from launching in the third quarter due to the flood.
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