Bangkok Condominium Market Q4 2010 Landmark year for condominium launches in Bangkok

Top Quote 2010 represented a record number of launches, dwarfing the figure for 2009 according to the latest Bangkok condominium market report for Q4 2010. End Quote
  • (1888PressRelease) January 24, 2011 - Over 20,000 units were launched in Q4 2010 for the whole of Bangkok, including the suburbs and a grand total of 60,000 were launched for the whole of 2010. It has reached the point that there are concerns of a supply bubble and recently the Bank of Thailand introduced a 90% loan to value curb in order to cool the market. But according to Antony Picon, Senior Research Manager for Colliers international Thailand these concerns are likely to be overblown. "Although 2010 was quite dramatic in comparison to recent years it simply means that developers are tapping into income levels largely ignored in the past and for 2011 this is likely to continue", he stressed. However he did point out that this year will see a transition from boom to consolidation. He stated that take up has been slowing to some extent as buyers shop around a bit more to find the right unit and the days of selling out new projects in one day are largely behind us but launches are likely to lessen over the coming quarters. "After all, developers also have to concentrate on building what they launched", he added.

    The market structure remains strong according to Patima Jeerapaet, Managing Director of Colliers. " Large listed household names continue to dominate the market but smaller non-listed developers are dipping their toes into the market with smaller scale products and this makes for a healthy, competitive market" he said. Mr Patima also remains bullish for the condominium market. " Bangkok's population will continue to grow and incomes will rise as well so there is plenty of future demand for the market to expand if at a lower pace than 2010", he stressed.

    While mass transit lines are a major factor in the condominium story, the picture is not all rosy. Colliers research indicates that with projects located within 200 metres of a station there is usually a good price premium as well as robust take up. However after this distance the pricing benefit weakens and take up can be lower, especially within a 200-500 metre distance. Mr Picon points to the need to use a paratransit service, that is a system for commuters to journey from home to the mass transit station once walking becomes too onerous, especially in the Bangkok heat. "Once you start to move more than 200 metres from a station then there is a greater likelihood of having to use some additional mode of transport" he explains. He pointed out that motorbikes are the preferred method but are seen as expensive, quite dangerous and lacking weather protection according to studies while songthaews are uncomfortable and irregular. Mr Picon suggests one way in the future could be to develop mass transit stations as retail/paratransit hubs that provide efficient access from the condominiums to and from each station using regular feeder bus services or even a light monorail. "The retail component could serve as a community mall serving the needs of residences connected by the feeder systems," he added.

    For more information please contact

    Colliers International Thailand
    Antony Picon
    Senior Manager | Research
    T: 662 656 7000
    E: antony.picon ( @ ) colliers dot com

    Surachet Kongcheep
    Manager | Research
    T: 662 656 7000
    E: surachet.kongcheep ( @ ) colliers dot com

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