PLUS PROPERTY, the full-service professional property and facility management agency, finds there is high potential for the Phaya Thai-Ratchathewi area due to the placement of famed educational institutes and leading shopping centres, as well as ease of commute to other important sites of business.
Demand hails from business people in Pratunam district, investors and students, as well as the ever-growing population within Bangkok. Responsive demand is 80-90 per cent for new projects, which is higher than the average 66 per cent response rate for central business district (CBD) area and other middle areas in Bangkok.
Plus Property managing director Anukul Ratpitaksanti disclosed that the Phaya Thai and Ratchathewi areas are attractive locations in the centre of Bangkok, according to surveys by Plus Property. The area has high potential approaching that of locations in Bangkok's inner area. It also has shopping centres such as Siam Square and Siam Paragon, and famed institutions including Triam Udom Suksa School and Chulalongkorn University.
This differentiates the Phaya Thai-Ratchathewi area from others within Bangkok's middle areas and make it comparable to a CBD area. As a result, development of residential projects such as apartments, hotels, hostels and co-working spaces have increased.
At the same time, condominium projects have been tailoring to the demand of business owners in the Pratunam area, investors, and parents of students. It has been determined that Bangkok is the province that possesses the highest number of non-registered population.
Over the past 30 years, non-registered population grew by about 50 per cent . In 2016, there were some 240,000 people from other provinces who were in Bangkok to study. Meanwhile, there was not much supply of new condominium units entering the market between 2013 and 2017. It is expected that condominiums in this area will become a rarity in the future, because of limited space for development , especially for projects near BTS stations.
Responsive demand is high for new projects in the Phaya Thai-Rachathewi area – at 80-90 per cent on average. This is higher than the average sale figure of 66 per cent for new projects in CBD area and middle zone.
The most recent survey discovered there were only 300 unsold units in 2018. If no new supply opens up, units in this area are expected to be completely sold out within one month.
There was good response for both new and old supply of units in the latter part of 2017, during which the response rate was 72 per cent and the absorption rate was about 30 units per month per project. Because of limited new supply, there is demand from investors as well as real residents for units in this area.
Consequently, the rate of return on investment is currently very attractive. High-rise projects situated near BTS stations or main road have a resale value of approximately Bt200,000 per square metre – which equates to a 7 per cent per annum price growth since each project's launch. Return on rent stands at about 5 per cent per annum, and rent stands at around Bt20,000-25,000 per month for a one-bedroom unit with 30-35 square metres of space. For low-rise projects, the resale price had grown by about 4 per per year whereas return from rent was about 4.5 per cent per year.
“Development of new projects is expected to be limited in this area, and almost no launch of new projects took place in 2017. Therefore, condominium prices in the Phaya Thai-Ratchathewi area are expected to rise at a rate which rivals that in CBD.
At present, we are starting to see investments by large players into the development of big projects such as shopping malls, office towers, mixed-use buildings and hotels. This will, in turn, increase the area's potential even further. Also, the area caters to a lifestyle that makes use of convenient commuting links to all the other important areas of Bangkok. All things considered, the price of condominium units in this area is expected to be able to grow |much more in the future”, said Anukul.