Though concentrated in Bangkok, the political protests have also affected the property market in Pattaya, as many foreign tourists cancelled their hotel reservations for the Christmas and New Year's period.
In addition, if political issues are not resolved within a few months, the whole country’s property market will probably be more affected, according to research by Colliers International Thailand.
The company’s associate director for research, Surachet Konghcheep, said its survey showed that new supplies of condominiums launched in 2013 continued to increase, while demand significantly decreased in the last quarter when the political turmoil erupted.
The total condo supply in Pattaya at the end of 2013 was approximately 54,650 units.
Surachet said only 800 units were added to the market in the first half of 2013, and nearly 7,100 units were completed and transferred in the second half. The total number of condominium units supplied to the market last year was the highest on record for Pattaya but demand has dropped slightly since the last quarter of the year.
The labour shortage is still the major obstacle in the construction industry, and is causing delays in completion of some condominium projects in Thailand, including some in Pattaya.
There were about 9,575 newly launched units in the second half of last year, about 30 per cent more than in the first half. For the full year, 16,978 new condominium units were launched, nearly 5 per cent fewer than in 2012, although many government agencies and property experts were concerned about oversupply, especially in the Jomtien area.
Surachet said about 10,770 units were scheduled to be completed this year in Jomtien, more than in other Pattaya locations.
Many Thai developers appear to be finding international sales difficult to attract to Pattaya, having rested on their reputations in Bangkok without a clear perception of how Pattaya and the foreign market works, he said. Many foreign buyers have never heard of big-name Bangkok developers and often their marketing is not foreigner-friendly. This is changing somewhat as many Thai developers realise that to be a success in Pattaya, they cannot rely solely on the local market and are attempting to address the situation, gradually, he said.
The Russia market continued its resilience during the second half of the year and it appears that it is less affected by global economic problems than other nations. European, British and American buyers have not shown the same high demand as in previous years, Surachet said.
Emerging markets such as China have now started to invest on an increasingly large scale in the Pattaya market. Strong interest from this economic powerhouse continues to grow rapidly from both Hong Kong and mainland China.
The other emerging market in the Pattaya property market is India, Surachet said. “We believe that India and China could quite possibly become the superpowers of the future when it comes to buying property in Pattaya, overtaking the Russian market and increasing exponentially year on year well into the future.”
The average condominium price in Pattaya at the end of 2013 was about Bt55,550 per square metre, similar to 2012, as most of the condo units launched in those two years were mid-range to low-end. Many cost factors directly related to construction, such as materials and logistics fees, increased, so the average price this year will probably rise by around 5-10 per cent, he said.