Real estate launches rise 22% in value in Q1

Real estate launches in the first quarter rose in value by 22% year-on-year to 50.89 billion baht from 81 projects with 22,333 units, a rise of 72%, according to a survey by the consulting firm Agency for Real Estate Affairs.

The agency’s president Sopon Pornchokchai said the supply in the first quarter rose in line with rising investor confidence and improved economic sentiment, as investors were largely unconcerned about political risk.

In his view, the surge in launches may not relate to the government’s property incentives.

Most developers applied a presales policy, so their launches would not necessarily be completed before incentives end on June 30, after being extended from May 31 in reaction to political unrest, he said.

Large developers have expanded their investment plans, partly supported by the raising of the ceiling price for a BoI home to 1.2 million baht.

This opens up tax incentives for developers from the Board of Investment, under its policy to promote affordable units for low- and middle-income earners.

Based on the first quarter’s figures, AREA forecasts that 89,332 units may be launched this year, 55% more than in 2009.

But the figure may be 10-20% lower than the prediction, he said.

The agency found that 43% of new launches in the quarter – or 9,604 units – were sold in the quarter, more than triple the 2,195 units sold in the same quarter last year.

Condominium units made up 55% of launches in the first quarter. The figure of 12,287 condo units launched was an increase of 142% from 5,073 units in the first quarter of 2009.

New townhouses totalled 6,227 units, up by 101% from 3,092 units. New single houses numbered 2,549 units, a dip of 18.35% from 3,122 units.

AREA found the average unit price for the first quarter was 2.279 million baht, down by 29% from 3.211 million a year earlier.

SOURCE: Bangkokpost