Bangkok Property Prices Set To Increase
Bangkok condominium prices are expected to grow by a terrific 10% in 2016 due to rising land appraisal value that will be increased by 25% on average.
Nalinrat Chareonsuphong, managing director of real estate firm Nexus Property Marketing Co, said: “Higher land appraisal prices would affect prices of condos being launched next year, as land costs would be higher from bigger property transfer fees.”
Condo price increase will depend on the condominium location. The more prime the location will be, the more important will be the price increase.
Land costs currently represent about 25 to 30% on average for a condo development with land costs in city center reaching as much as 40% of the total development cost.
In the first half of 2015, land prices already increased by 15% year-on-year on average in the Kindgom’s capital. The Chidlom area has even registered a record price of THB1.91 million per Sq.wah (THB477,500 per SQM).
Such extremely high prices have pushed property developers to build high-end and luxury properties as developing low segment residential properties would not be profitable. This is why condo prices will keep increasing and especially in prime locations (downtown Sukhumvit and Silom/Sathorn) where available land plots are becoming rare. In the first half of 2015, new units launched in these areas reached as much as THB200,000+ per SQM as starting prices.