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Demand is waning for Thailand condos after the 2012-13 boom

By on Feb 23, 2015 in Property News

773852The condominium market in destinations favoured by SET-listed developers is feeling the pinch from weak demand. This is particularly in provinces such as Chiang Mai, Udon Thani, Khon Kaen, Chon Buri and Phuket.  Chiang Mai is a good example. New condo units launched each year in the province numbered only in the hundreds before 2011. The number soared to the thousands each year from 2012.

Some projects completed last year had unit transfers of only 30% despite a sales rate of 80%. This happened for various reasons, including buyers failing to get home loan approval, while some were speculators who failed to find buyers to resell the unit to. Prasert Taedullayasatit, president of the Thai Condominium Association, says condo price increases in the provinces are relatively slow, making most buyers reluctant to get a unit transfer.

Banks continue extending home loans to condo buyers in Greater Bangkok where condo prices, once the projects are completed, will rise at least 30% from the launch date, says Mr Prasert.

The REIC survey found that while major provinces had been suffering from oversupply, the housing market in minor provinces remained in good shape, as supply met demand.

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