Agency sees stable growth in condo market next year

Real Estate December 24, 2018 13:29

By The Nation

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Property agency Nexus Property Marketing Co Ltd estimates that the supply of condominiums in 2019 should increase at around the average growth rate over the past five years, by 53,000 units. 

Meanwhile, the demand should range between 50,000-55,000 units. Based on the forecast, total sales in units and the remaining supply in 2019 should also be relatively the same this year, the company’s managing director, Nalinrat Chareonsuphong, said on Monday.

This year the average price of condominium units in Bangkok surged 7.6 per cent while prices of condominium units in the downtown area rose by 10 per cent. 

She said developers should focus more on city condo projects and the mid-market to serve the majority of people living in Bangkok so that the units can be sold to those who buy them for their own accommodation rather than target foreigners who buy them as investment. 

“However, we do not ignore foreign investment. There has been continuous demand from large investors or institutional investors," she said. 

In 2019, investments from international investors especially Japan, China, Hong Kong and Singapore should increase from 26 per cent (15,820 units from 24 projects in 2018) to 30 per cent. Demand from Hong Kong, Singapore and Taiwan markets should not be lower than the previous year. Meanwhile, the Cambodia, Laos, Myanmar and Vietnam markets will be in the limelight. 

Analysing condominium price trends in Bangkok over the next 1-3 years, Nexus said it believes the rate of price increase will be lower than the past while the price of land will not surge as aggressively as it did several years ago. It is expected that condominium prices will increase at approximately 6-7 per cent per year, she said.

Meanwhile, the price of Grade A rental offices in the CBD area exceeded Bt1,000 per square metre per month. The price of retail space in shopping centres went up to 3,900 baht/sq.m./month and is likely to keep surging. Next year, the rental office and retail markets seem headed for more fierce competition, she said.