Back
Currency
THB - Thai Baht
USD - U.S. Dollar
GBP - British Pound
EUR - Euro
JPY - Japanese Yen
AUD - Australian Dollar
HKD - Hong Kong Dollar
CNY - Chinese Yuan
SGD - Singapore Dollar
TWD - Taiwan Dollar
RUB - Russian Ruble
MYR - Malaysian Ringgit
INR - Indian Rupee
Note: The exchange rate shown here is for reference only.
Advisory & Transaction
Research & Consulting
Valuation
Property Management
Enterprise Facilities Management
This website uses cookies to improve user experience. By using our website, you consent in accordance with our Cookie Policy.
Accept
Menu
Buy
Industrial
Factory / Warehouse / Industrial Land
Whole Building
Apartment / Serviced Apartment Building /
Office Building / Golf Course / Shophouse /
Other Investment Properties
Condominium Project
Muniq Sukhumvit 23
Rent
Industrial
Factory / Warehouse / Industrial Land
Whole Building
Apartment / Serviced Apartment Building /
Office Building / Golf Course / Shophouse /
Other Investment Properties
Office
Rasa Two
Sell / LeaseProperty Search
Choose your currency
THB
Currency Settings
THB - Thai Baht
USD - U.S. Dollar
GBP - British Pound
EUR - Euro
JPY - Japanese Yen
AUD - Australian Dollar
HKD - Hong Kong Dollar
CNY - Chinese Yuan
SGD - Singapore Dollar
TWD - Taiwan Dollar
RUB - Russian Ruble
MYR - Malaysian Ringgit
INR - Indian Rupee
Note: The exchange rate shown here is for reference only.
Site Search
Site Search
Fill out this field.

2019 Year-end Wrap-up for Bangkok Condominium Market

December 23, 2019
Share
Close

Caught between slow economic growth, high household debt and growing supply, 2019 has been a very challenging year for the residential market in Bangkok, according to CBRE, an international real estate consultancy company. Developers have put the brakes on launching new projects as market sentiment declines. Foreign sales have also been impacted by the strong Thai baht and weak global economic growth, especially in China.

Weak domestic demand has prompted developers to reconsider new condominium project launch dates, revise products and postpone land acquisition for new developments. Despite a strong start to 2019, the market has slowed down more visibly since Q2 2019. In Q3 2019, CBRE Research has seen the lowest number of new downtown condominium units launched in the third quarter since 2015, at 1,268 units, compared to 7,147 units in the same period last year.

While CBRE believes that the average selling price for condominiums in Bangkok will not drop, because the land cost remains high, an increase in price will be at a slower rate compared to previous years. The average selling price in downtown Bangkok only grew by 0.9% y-o-y to THB279,740 per square metre in Q3 2019, while midtown Bangkok’s average selling price only increased by 0.05% y-o-y to THB99,943 per square metre. Affordability will be the key issue in the market in 2020, as locals have less spending power due to increasing household debt and a weak economy.

The government and the Bank of Thailand have taken various measures this year to stimulate the residential market. The tighter loan-to-value (LTV) regulation, which CBRE believes was a well-intended move to keep the market from being flooded with speculative buyers, has dampened domestic demand, as mortgages become harder to obtain. Both the transfer fee and mortgage registration fee have been reduced to 0.01% from 2% and 1%, respectively, for property with a price of less than THB3 million.

The policy rate has been cut twice this year to encourage spending, from 1.75% to 1.25%, which is similar to the rate during the global financial crisis. However, in a situation where the economy is weak with limited spending power, CBRE Research believes that this reduction did not have a significant impact on the property market.

The Thai baht has continued to appreciate since the beginning of the year, which has resulted in Bangkok properties being more expensive for foreign buyers to invest. As of Q3 2019, the baht has appreciated 9.5% against the Chinese yuan, and 6.1% against the US dollar, compared to last year.

“With the growing uncertainty in the residential market, developers will need to minimise and diversify investment risks, creating a more diverse revenue stream. Many developers have already started looking at recurring-income properties or mixed-use developments, especially on large land plots, to make their projects more attractive, with complementary uses in a single compound. Key resort destinations like Hua Hin, Pattaya, Phuket and Krabi present opportunities for developers as Thailand’s infrastructure is expanding significantly and tourism industry remains as strong as ever,” said Ms. Aliwassa Pathnadabutr, Managing Director of CBRE Thailand.

Back

More News

Contact Us