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Bangkok Residential Q4 Price Downtown Continues to Rise

By on Mar 28, 2014 in Research

Bangkok Residential MarketView Q4, 2013

Bangkok Residential MarketView Q4, 2013One highlight of the new launches in this quarter was The Diplomat Sathorn (192 units) in the downtown area, with more than 90% sold within two months of being launched. By the KPN Group at an average price of THB 250,000 per square metre, which is higher than other projects in the immediate area.

There will be limited future supply of larger two or three bedroom units in the most prime downtown areas, which are popular location with expatriates with the highest housing rental allowances. With rising expatriate numbers this means that we could finally see expatriate rental rates start to increase.

Much of the built but unsold inventory in the downtown area has been cleared and with limited new supply, prices of buildings in the best locations are rising.

We are predicting a slower year for the midtown/suburban sector due to many factors such as the amount of new supply due for completion over the next two years, and concerns about how many speculators bought into these projects combined with weaker end user demand due to the on-going political crisis, as well as increasing consumer debt. There are also concerns about the increasing debt to equity ratios for publicly listed developers. Cash flow has been reduced and made more risky by offering low down payments. Banks are going to be more cautious about project lending, which will slow down the number of potential new projects.

We expect to see fewer new projects with developers concentrating on selling out and transferring titles of their existing inventory both in completed and incomplete projects. This has already been publicly confirmed by some major developers.

This is an extract from Bangkok Residential MarketView Q4 2013, click to download the full report at Bangkok Residential MarketView.

Toby has been living in Bangkok for a number of years and has a strong research background. With his years in Thailand Toby brings a wide range of property knowledge to his research writing

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