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Realty market improving despite row: Knight Frank

The political issue in Thailand is currently not a big deal for the property business, according to Knight Frank. Things were difficult in the first four or five months and the real-estate market was soft, but the situation is gradually improving, said Frank Khan, executive director and head of residential for the firm's Thai unit.

Despite the political turmoil, the private sector is still strong, and its performance helps the overall economy. To look on the bright side, the political unrest has been beneficial in that the condominium market has cooled down, reducing the likelihood of an oversupply, he said.

He added that in the past three months, Knight Frank introduced Thai residential projects at private exhibitions in Kuala Lumpur, and the company experienced good responses from foreign investors.

The emergence of the Asean Economic Community will drive demand for business expansion and accommodation. Thanks to Thailand's infrastructural readiness and strategic location, foreign investments by multinational companies are expected to grow, exceeding the 90-per-cent occupancy rate of Bangkok office space.

Economic activity from the flow of people among the countries in the region could boost economies throughout Southeast Asia. And with its many advantages, Thailand should see demand for residential property increase as a consequence of such business growth, he said.

Khan also forecast that the limited supply of land for developing condominium projects, as well as the increase of development costs such as land, labour and materials, would drive condo prices up in the future.

During the latest land review in July 2012 (it is conducted every four years), land in Silom was reappraised from Bt650,000 to Bt850,000 per square wah (Bt162,500 to Bt212,500 per square metre), an increase of 7.7 per cent per annum.


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