Nexus: 2017 residential market trend will highlight quality rather than quantity.Downtown will remain attractive location for luxury property developers.

Real Estate Press Releases Wednesday December 21, 2016 15:56
Bangkok--21 Dec--Agate Communications

Mrs. Nalinrat Chareonsuphong, Managing Director of Nexus Property Marketing Company Limited discloses Bangkok residential market survey findings in 2016 that "residential market growth is stable. Overall condominium prices increase 14% while luxury condo market in downtown sees a higher increase in prices than that in outer area. New supply slightly slows down which is good to the industry as the existing supply launched in the previous year is absorbed."

Bangkok Condominium Market

Although the overall market situation is quite stable and developers decided to delay launching some new projects in the fourth quarter, a number of new supply launched in 2016 totaled 40,000 units from 94 projects. As a result, there are 487,000 condo units in the Bangkok condominium market. The number of new condo supply launched in 2016 was 25% lower than that in 2015 (there were 53,000 units launched in 2015). Top three locations where the largest number of new condo supply launched include 1. Phra Khanong, Suan Luang (10,700 units) 2. Phaya Thai, Ratchadaphisek (9,200 units) and 3. Ngamwongwan, Tiwanon (6,900 units). These number account for over 67% of the total newly launched units. There is an eye-catching issue: though a number of newly launched condo in the fourth quarter slows down, 70% of the new launch this year was in the second half, indicating that developers remain confident in Bangkok condo market growth.


During the past five years, new sales of condo in the market was averaged at approximately 51,200 units per year. In 2016, new sales of condominium in the market totaled 46,100 units, around 10% lower than that of the 5-year average. However, the decrease in the number of new condo supply launched this year to 40,000 units reflected that new demand is higher than new supply and sales rate of overall condo in the market rises to 90% (outstanding sold units of condo totaled 438,000 units).

In 2016, new project launched in the market records an average sales of 64%. Top three locations where sales rate was highest include 1. Phra Khanong, Suan Luang 2. Phaya Thai, Ratchadaphisek 3. Ngamwongwan, Tiwanon.


In 2016, average selling price of Bangkok condo continues rising with an increase of 14% from 106,000 baht per square meter to 121,000 baht per sq. m. This rise is significantly higher than the 5-year average of 8% per annum. In particular, price of condo in the central area rises by 15-16%. Condo price at every new project launched in the central area of Bangkok is higher than 150,000 baht per sq. m. Key factor remains from land costs which soar in every location and other development costs continue rising. In addition, price of newly launched projects in the city fringe area which extends from the central area significantly rises in price. Locations where price significantly increases include Din Daeng, Phahon Yothin, Phra Khanong and Prachachuen. For projects in outer area, price moderately increase at around 8%.

Regarding condominium pricing and sales strategy, several condominiums which have potential to rent out have offered guaranteed return from buying condominium to speed up the sales. This considers a relatively successful campaign during the year.

2017 Condo Market Trend

Supply is expected to increase by 10% and majority of this supply is likely to be located in the city fringe and outer areas of Bangkok. Demand will grow at the same rate of supply but higher growth will be witnessed in outer area of Bangkok. However, development costs which is reflecting condominium price will be the factor for this market growth.

For condominium price, it is conservatively estimated that average price will be increased at least 6-7% while in the city area it is likely to see a higher growth to an average of around 9-10%.

When considering condo market movement by segment, it is categorized into five segments: 1) super-luxury market is condo priced from 250,000 baht/sq. m. 2) luxury market is condo priced between 180,000-250,000 baht/sq. m. 3) high-end market is condo priced between 100,000-170,000 baht/sq. m. 4) middle market is condo priced between 70,000-100,000 baht/sq. m. and 5) city condo market is condo priced lower than 70,000 baht/sq. m. For super-luxury and luxury market, new condo supply is likely to be developed by well-known developers. Besides 98 Wireless where price is higher than 700,000 baht per sq. m., new condo in some super-luxury markets in 2017 will likely to launch at the price of over 450,000 baht per sq. m. In super-luxury market segment, price is not a key factor to make decision but it is potential of location and premium of product. This is different from product in luxury or high-end segment where price and value of product remain important besides location. Buyers in high-end segment are those already having a house. For them, second home is for an investment and residence. They will choose a familiar location and a unit where they can really use in term of function.

In 2016, high-end condo developed by listed developers continue doing well as they have investment buyers as regular customers and channels to re-sell the units for them. However, this market needs to be kept watching in 2017 on whether demand will continue or not.

For city condo market, each location has a difference in price range and demand but price remains a key factor for decision making, therefore the price increase will be slightly limited in this segment. When costs soar, unit size become a key factor to develop a product that suitable affordability of this market segment.

Location Trends: For super-luxury market there are two attractive locations that may have several project launched including Phloen Chit/Chidlom/ Langsuan and Thong Lor/Sukhumvit 39-49. In luxury segment, lower Paholyothin, Riverside and Phaya Thai will be appealing areas. Locations along the Orange Line, the Yellow Line and the Pink Line are those eye-catching areas for new condominium development, Pink Line, particularly in Chaeng Wattana area are interesting as the number of new supply launched in this location is very limited comparing to other zones of Bangkok.

For developers, since some projects are delayed to be launched next year, activities and new launched will actively be seen in January. Listed companies remains focusing on their growth which should be at the same pace and continue developed new projects in various segments while some smaller or mid-size developers, their strategy will be more focus on product feature and idea as well as construction quality. This year we have seen more medium scale developers having a joint venture with foreign partners which will reflect to stronger financial background and better product technology.

In 2016, several infrastructure projects have more progress which will contribute to real estate market growth in 2017.
2017 Bangkok Condo Market Trend
Low-rise Housing Market in Bangkok

Luxury house in a good location in the central city area will continue growing. Location and premium quality product is key success for the project. And like condo in super-luxury segment, price is not a key factor as much as function and prestige that meets target buyer's lifestyle.

In 2017, single detached house priced between 5-10 million baht in convenient location will be promising while townhouse near the central city area at the same price range is also eye-catching. This is because consumer in this segment is a family with stable income and looks for a house with more function space for the family (in comparison to condominium). Townhouse priced lower than 3 million baht is a mass market segment where growth continues. However, like city condo affordable price and value is the key factor to this market. Household debt and ability to get mortgage loan is a key factor for success in this segment next year.

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