Affordable in demand, but foreigners “off the radar” in Bangkok

Research from global real estate advisor DTZ has revealed that demand for affordable condominiums in central Bangkok remains strong, despite the recent political instability. However, the company cautions that foreigners are likely to remain “off the radar”, especially for luxury property projects, until the situation becomes more certain.

Bangkok property

Bangkok Real Estate

The report noted that activity in Bangkok’s Central Business District (CBD) residential property sector waned with the disruption from the political riots which took place during the quarter. The majority of real estate activity was concentrated in peripheral fringe and suburban locations near to the mass transit lines.

Demand for smaller one- and two-bedroom (40 sqm to 70 sqm) affordable units, which are usually priced below THB80,000 (US$2,470) per sqm, remained upbeat despite the political woes.

CBD condominium rents averaged THB452 (US$13.97) per sqm per month in Q2 2010, reflecting no change quarter-on-quarter. The overall average capital value for the CBD condominium market was also stable, registering no change over the quarter to stand at THB82,740 (US$2,548) per sqm.

Low Ming Tze, Senior Manager of DTZ Thailand Research, said: “New launches within the CBD will be very selective. With the uncertain political and economic conditions, developers are more cautious in initiating new projects. More time is being taken to conduct due diligence studies prior to launching a new project.”

She added: “Buying activity over the next quarter will largely be dominated by domestic purchasers – both end users and speculators. Foreign investors are likely to remain off the radar, particularly for luxury projects, until there is more certainty in the political situation.”

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