Developers focus on demand for vacation homes and those working in the areas
The property market in both Pattaya and Hua Hin is expanding strongly, with developers focusing mainly on local demand from buyers seeking a vacation residence and those working in the coastal locations, according to research by real-estate agencies.
Colliers International Thailand’s research found that 800 condominium units were completed and transferred in Pattaya City during the first half of this year, higher than the number completed in the whole of last year.
Meanwhile, the number of newly launched units in the first half was similar to the level reached during the second half of last year. About 7,400 units were launched, with around 52 per cent of them in condominiums in the Jomtien area.
Three listed developers – Sansiri, Supalai and SC Asset Corp – launched their first projects in Pattaya City in the first half of the year and received good feedback from buyers, especially among Thais.
At the end of the period, the total supply of condominium units amounted to about 47,490, said Colliers. More than 13,000 units were under construction and scheduled to be completed by year-end, the highest on record for the city.
A labour shortage is still the major obstacle in the construction industry, which is causing delays to the completion of some condominium projects on time in Thailand, including some in Pattaya, the company said in its research.
The condominium supply expected to be completed between the second half of this year and 2015 in the Jomtien area is more than 15,000 units, the research said.
The largest supply is in Jomtien, representing about 42 per cent of the total, followed by Pattaya with around 30 per cent.
The Pattaya area was home to the majority share of the Pattaya City condominium market from 1990 to 2000, but due to the limited plots of land, developers are moving southward. Jomtien is the new location for property development, especially around the Jomtien Second Road, which officially opened in 2005, said the property agency.
The total share of the Jomtien area has, therefore, increased to become the largest in the Pattaya City condominium market.
Colliers said the pattern of overall real-estate development is different for Jomtien and Pattaya, as Pattaya contains the vast majority of both hotels and commercial developments, which leaves very limited land supply for large-scale condominiums.
Meanwhile, a report by property agency Knight Frank Thailand’s Research Department shows that the cumulative supply of Pattaya condominiums at the end of the first half stood at 40,939 units, increasing by 32.9 per cent over the end of the second half of last year.
Some 10,153 units from 20 condominium projects were offered during the first half of the year.
The Jomtien area gained in popularity, in terms of condominium development in the broader Pattaya market, with about 4,247 units launched during the first six months, or around 42 per cent of total new launches, Knight Frank’s research found.
Demand for Pattaya condos at the end of first half totalled 21,614 units, with the take-up rate having grown from 50.3 per cent at the end of last year to 51.7 per cent on June 30.
Sea-view condominiums located in the North Pattaya/Wongamat area represented the highest average selling price per square metre in the Pattaya condo market at Bt135,240 per square metre, followed by Jomtien and Pratumnak, at Bt128,725 and Bt89,010, respectively.
Knight Frank believes the Pattaya property outlook has a promising future as a key market for Thai condominium development.
It is riding on the property boom, adding 1,890 new residential units that are scheduled to launch during the current quarter.
Emerging locations from Jomtien to Na Jomtien are set to be major development sites, driven by a myriad of factors that give the area a number of advantages over other locations in Pattaya.
These factors include improving road connections via a second road that runs parallel to Jomtien Beach Road for about 400 metres, and many new attractions such as the Jomtien market and two water parks – Ramayana, the biggest water park in Southeast Asia, and Cartoon Network Amazone – which are due to open later this year.
There is also the Grand Kingdom shopping mall, which will draw families with young children and shoppers to the area.
There will be new demand for Pattaya condominiums from local Thai buyers, particularly for projects located in North Pattaya/Wongamart, due to the many restaurants, retail outlets and shopping malls that are already in place.
The more tranquil condo projects situated in Jomtien are very popular for visitors from Russia and Scandinavia who are looking for affordable units in this peaceful holiday destination as a second or vacation home, said the company’s Research Department.
Hua Hin, Cha-am boom
Meanwhile, more than 240 condominium units were completed in the Hua Hin, Cha-am and Pranburi areas in first half of the year, said Colliers International Thailand Research.
Some 520 units of landed development were launched in the period, the lowest number in the past few quarters.
The condominium market was the most fashionable for residential development in the area, with about 80 per cent of the newly launched units in the first half being condos. Most buyers in the Cha-am, Hua Hin and Pranburi areas are Thai, especially in condominiums and housing-development projects, while some foreign retirees own or rent condominiums or houses in the area.
The average take-up rate of all property types in the three locations is around 69 per cent, with 67 per cent for landed development projects and 69 per cent for condominiums.
The average price of condominium and landed development projects is still similar to the previous year, said Colliers.
The mid-range market is the most fashionable in the area, so most residential units launched in the first half were priced up to Bt4 million.