A GOOD TIME TO BUY A CONDOMINIUM

By Aliwassa Pathnadabutr
managing director of CB Richard Ellis Thailand
Published on October 19, 2009

During the last few months, the downtown condominium market seems to have been active again, as market sentiment has improved following the economic recovery and surging stock market.

New project launches such as Collezio, The Address Asoke, The Address Sukhumvit, Villa Asoke and Noble Refine have been successful, and we have found that projects with the following characteristics are selling well:

lIn very good locations, either near or within walking distance of a mass-transit station or somewhere on a main street. The buyers' preferred locations are on or near main roads, as they know that there is a limited supply of freehold land on main roads in downtown Bangkok.

lWhere the majority of units have one bedroom, with some small two-bedroom units. Most of the unit sizes are now smaller in order to keep the unit price low. However, even if the size is too small for living, this does not seem to matter to buyers.

lIn the upper-middle to high-end segment with unit prices in the range of Bt4 million-Bt8 million.

The market has changed quickly in recent months. Based on the absorption rate of future downtown condominium projects which now on average have less than 20 per cent of their units left for sale and an improving economic situation, we should have a clearer picture of the market recovery next year. Concerns about a W-shaped economic recovery and the ongoing political situation still exist, but the lack of supply of downtown condominiums in good locations may not deter buyers from investing their money in good assets which they believe will appreciate in value in the future.

In the luxury segment, with prices of over Bt10 million, we have seen evidence of price adjustments, starting with the three new completed luxury condominiums downtown: The Park Chidlom, Athenee Residence and The Infinity, at which almost 100 per cent of the units have been sold and already transferred. Over the last eight months, buyers have been able to purchase resale units in these buildings at average prices of Bt110,000-Bt135,000 per square metre. Recently, after the units had been sold and transferred, not many were available for resale and so the prices increased by 15-20 per cent from their lowest level. Today, the asking prices in these buildings are on average Bt140,000-Bt165,000 per square metre. Many people have realised that they have missed the opportunity to buy units at these projects when prices were at their lowest.

This trend in recent months indicates positive signs of strong demand and affordability for well-located grade-A condominiums. In view of the limited supply of good condominiums and current prices, you should buy now before missing the boat.

A GOOD TIME TO BUY A CONDOMINIUM

During the last few months, the downtown condominium market seems to have been active again, as market sentiment has improved following the economic recovery and surging stock market.

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