The condominium market in Bangkok, Thailand’s upper Sukhumvit area experienced a slowdown both in terms of supply and demand last year with developers launching less projects in line with market conditions, said Knight Frank Thailand research director Risinee Sarikaputra.
A research by the company found that the supply of condominiums in the Phra Khanong-Onnuch-Punnawithi-Udomsuk area amounted to a total of 47,927 units during the first 11 months of last year. There were only 1,788 new condominium units launched for sale during the period.
There were a total supply of 19,312 units in the Lasalle-Bearing-Samrong area in the first 11 months with 639 new condominium units launched for sale.
However, the drop in supply has led to an increase in condominium sales in upper Sukhumvit.
In the Phra Khanong-Onnuch-Punnawithi area, there were a total of 43,214 condominium units sold out of 47,927, representing a sales rate of 90.2 per cent, an increase of more than 87 per cent year-on-year.
The condominium units sold in the Lasalle-Bearing-Samrong area was 15,179 out of 19,312 units, representing a sales rate of 78.6 per cent, an increase from 72.4 per cent in 2018.
Condominium buyers in upper Sukhumvit included both Thais and foreigners who purchased the properties as their own residences or to rent out as investments.
Some buyers also purchased condominiums in this area as assets, as the selling prices of such units are still affordable and there is the likelihood that prices will increase in the future.
In addition, the upper Sukhumvit area itself has the potential for growth due to the development of two billion-baht mega projects, “True Digital Park” and “Bangkok Mall”.
Both are mixed-use smart urban projects. “True Digital Park” is located on 6.4ha of land with the first phase comprising two 40-storey buildings with condominiums, an office building at the top and retail spaces on ground floor. The project’s second phase will include a hotel.
The “Bangkok Mall” project, located on 16ha of land, is being developed by The Mall Group. The construction area is expected to be around 800,000sqm, consisting of a shopping centre, office buildings and hotels.
When both of these large projects open, they will definitely make an impact on the upper Sukhumvit area.
Condominiums prices have been rising continuously. The average selling price of Grade A condominiums in Phra Khanong-On Nut-Punnawithi-Udomsuk in November was 166,780 baht ($5,500) per square metre, compared to 122,493 baht per square metre in 2012. From 2012 to mid-2019, the area experienced a six-year Compound Annual Growth Rate (CAGR) of 5.9 per cent.
The average selling price of Grade B condominiums in the area in November was 100,500 baht per square metre, increasing from 83,600 baht per square metre in 2011. From 2011 to November 2019, the area experienced a seven-year Compound Annual Growth Rate of 2.7 per cent.
Grade C condominiums in the area in November had an average selling price of 68,125 baht per square metre, compared to an average price of 57,098 baht per square metre in 2011. From 2011 to November 2019, the area experienced a seven-year Compound Annual Growth Rate of 2.6 per cent.
Grade B condominiums in the La Salle-Bearing-Samrong area had an average selling price in November of 93,459 baht per square metre, an increase from 2012 which had an average selling price of 83,235 baht per square metre. From 2012 to November 2019, the area experienced a six-year Compound Annual Growth Rate of 2.05 per cent.
The average selling price of Grade C condominiums in November was 62,113 baht per square metre, rising from 45,571 baht per square metre in 2011. From 2011 to November 2019, the area experienced a seven-year Compound Annual Growth Rate of 5.2 per cent.
The selling price of condominiums in this area is likely to increase further. In comparison, the average selling price of high-rise condominium units in the Phra Khanong-On Nut-Punnawithi-Udomsuk area is 138,000 baht per square metre.
THE NATION (THAILAND)/ANN