No: 08pr703
Date: 17 February 2011 |
|
KNIGHT FRANK THAILAND REVEALED BANGKOK CONDOMINIUM PRICE ROSE 3.4% IN Q4
2010 AND NEW SUPPLY IN 2011 SHIFTED TO CBD AREA
Mr. Phanom Kanjanathiemthao, Managing Director of Knight Frank Thailand
revealed that the condominium gained popularity in 2010, with the influx
of approximately 68,745 units in Bangkok, increase nearly 2 times compared
to the year 2009. The overall selling price rose by 3.4% in the last quarter
of 2010.
The area where the selling price recorded the highest increasing
was the city fringe area, rising about 5.04%, whereas the city area rose
about 3.65%. Mr. Phanom said that previously, the inner city was
the most
popular area for condominium due to the land price in the inner city is
expensive. City Fringe Condominium gained popularity in 2004 since the opening
of the MRT underground. Peripheral Condominium were fabulous in 2010, with
the new supply introduced to the market accounted for about 72 percent,
thus the tremendous supply has forced the selling price to increase slightly,
with only 1.63%.
Mr. Phanom added the supply of the inner city accounted for 6%
but the selling price increased less than the city fringe area, this is
due to the fact that the majority of city condominium is generated by speculators
and investors buy-to-rent where the political instability in Thailand has
damaged their confident, whilst the city fringe area is the area where the
mass-transit has been operated so this area is convenient for buyers. The
demand is predominantly generated from Thais. Sales were still most prevalent
in the medium to low-end sector. The selling price in this area is in the
range of THB 50,120 to 82,487 per square metre, depending on the location,
specification, facilities and amenities provided by the projects. Another
major cost of condominium is land price, recently it is quite difficult
to find a good land plot located in the city fringe area, thus it is forecasted
that the selling price of city fringe condominium will increased sharply
this year.
Supply Trend
The cumulative supply of Bangkok condominium was 183,378 units,
the new supply added in the year 2010 was skyrocketing, with approximately
68,745 units. Previously, the inner city was the most popular area for
condominium due to the land price in the inner city is expensive. City
Fringe Condominium gained popularity in 2004 since the opening of the
MRT underground. Peripheral Condominium were fabulous in 2010, especially
in the second half of last year and December is the month of launching
of new supply in the area which may have been chilly in the rest of the
world, but for Bangkok Condominium Market, it was sizzling, with the influx
of about 28,483 condominium units launched during the last quarter of
the year. The influx of new condominium units last year recorded increased
by 182 percent compared to 2009.
Source: Knight Frank Thailand Research
The majority of new condominium units in 2010 was launched in the
last quarter, with approximately 41 percent of total units launch
in the year, whereas in Q2, there was only 10 percent.
Source: Knight Frank Thailand Research
Demand Trend
Demand of Bangkok condominium in 2010 was predominantly generated
from Thais. Sales were still most prevalent in the low-end sector.
Demand in affordable condominium developments was strong, especially
the projects along planned new mass transit lines.
The take up units during the last quarter recorded at 12,189 units,
only 1% reduction from Q3. The Q4 take up rate was lowest with
about 42.8%, however, the units launch in Q4 was 30 percent higher
than the units launch in Q3.
Source: Knight Frank Thailand Research
Pricing Trend
Selling price rises up quarter to quarter due to the fact that
the increasing of oil price, construction material and labour
cost. The inflation rate is effected the selling price of condominium
units. On the other hand, the units with higher specification will cost
higher than the one with lower specification, thus the selling price increased
in every area in Q4 2010, compared with previous quarter. Another important
factor is the location, though the project is located in the
city area, however the condominium price of the project locating on the
main road will be higher than those located in soi, with a distant to
the main road.
The selling price of Grade A City Condominium was at THB 128,752
per square metre which was the highest since there was no new supply
of premium grade condominium in the year 2010. The selling price in the
city area increased in the range of 2-5% from Q3. Whilst the selling price
in the peripheral area was quite stable due to the majority of new supply
added in this area during the last quarter of 2010.
Source: Knight Frank Thailand Research
Market Outlook
Mr. Phanom forecasted that the new supply of condominium in 2011
will be shifted to the city area with the proof of land sales transaction
last year. The condominium in the peripheral area still has opportunity
in some particular locations where the supply is not tremendous.
The number of condominium supply may be less than last year since
developers are aware of competitions which will lead to price war. However,
there will be some developments in the peripheral area due to the land in
the lack of land in the city area. The selling price per square metre is
expected to increase due to the hike of construction cost and inflation
rate, thus the condominium unit would be compact in order to maintain the
unit price to be affordable by the buyers. The condominium buyers will be
for their own usage rather than speculation or buy-to-rent.
APPENDIX
Condominium Location:
City Area: This is the area that surrounds the Central Business District
as well as the area which is popular for expatriates, tourists and upper
class Thais for both shopping and residential area. Another area in the
City Area is the area along Chao Phraya River which lies on Charoen Nakorn
and Rama III Road. The City Area can be divided into sub-area as followed:
Central Business District (CBD): This is the area that encompasses
Sathorn Road, Silom Road and Wireless Road CBD corridors. It is an established
business location with quick access to Sukhumvit, Rama 3 and the riverside
areas.
Sukhumvit: This is the section of Sukhumvit Road between Soi 1
and Soi 63 to the north and Soi 2 and Soi 42 to the south. This popular
area with expatriates and tourists spans includes the Asoke Intersection
on the west to the Emporium Mall to the east.
Rama 3 and Riverside: This is the area that stretches along Charoen
Na Korn Road of the Chao Phraya River southward just past the Sathorn Bridge
and to the north of Sipraya Road as well as the area along both side of
Narathiwas Ratchamakarin Road.
City Fringe Area: The area is located on the edge of the City Area, provides
easy access to the City Area. This area is an alternative for condominium
buyers due to the close proximity to many shopping centers and
also convenient for transportation. The City Fringe Area can be
divided into sub-areas as followed:
Ratchada-Ladprao Area: This is the area where the MRT is opened.
The area covered both side of Ratchadapisek Road and the beginning
of Ladprao Road where there are MRT stations situated.
Phahonyothin Area: This is the area which has just started popular
in a couple of years. The area covers between Phahonyothin Soi
1 and Soi 13 and Phahonyothin Soi 2 to Soi 14.
Bangkok Peripheral Area: The areas which are not included in the mentioned
area. Our analysis will explore three major areas in this locations
which are:
Late Sukhumvit: This is the section of Sukhumvit Road both sides
after the Sukhumvit Soi 63 stretch to the Bang na intersection.
Thonburi Area: This is the area where the new BTS extension from
Saphan Taksin to Wongwian Yai already opened.
Other Areas: This area is the area outside the area already mentioned.
Most of the remaining condominium areas are scattered across the
city including Srinakarin, Chaengwattana, Kaset-Navamin, Petchkasem and
etc.
Condominium Classification:
Premium:
The location is in Central Business District, Sukhumvit (Soi 1-63
and Soi 2-42) and along the area along the Chao Phraya River.
The selling price of the unit must not be less than THB 150,000
per square metre.
The minimum unit size must not be smaller than 120 square metre.
The ceiling height of the unit must be at the minimum of 3 metre.
The unit decoration must provide high standard specification.
Grade A:
The location is in the Central Business District, Sukhumvit (Soi
1-63 and Soi 2-42), the area along Chao Phraya River and the Pathumwan to
Soi Aree (Paholyothin Soi 5).
The selling price of the unit must be in the range of THB 100,000
to 149,999 per square metre.
The minimum unit size start from 50 square metre.
The ceiling height of the unit must be at the minimum of 2.7 metre.
Grade B:
Any location in Bangkok.
The selling price of the unit must be in the range of THB 60,000
to 99,9999 per square metre.
For further information, please contact:
Chompoonud Phienpanij, Marketing Communication and PR Manager,
+66(0) 26438223 Ext 138,
Mobile: +66 (0)81-901-6333
Ends
Notes to Editors
Knight Frank LLP is the leading independent global property consultancy.
Headquartered in London, Knight Frank and its New York-based global partner,
Newmark Knight Frank, operate from 207 offices, in 43 countries, across
six continents. More than 6,340 professionals handle in excess of US$886
billion (£594 billion) worth of commercial, agricultural and residential
real estate annually, advising clients ranging from individual owners
and buyers to major developers, investors and corporate tenants. For further
information about the Company, please visit www.knightfrank.com.
|
