Government recent financial stimulus to boost Thai property market – reducing Transfer fees from 2% to 0.01% and mortgages fees from 1% to 0.01% – mostly benefit completed projects. As a result, Bangkok has witness a considerable drop in the number of newly launched condominiums.
According to SET-listed property developer LPN Development PLC’s research department, the number of units launched in Greater Bangkok dropped by 55% from August to only 2,045.
“The decline was due to many developers holding sales events for completed projects that still had remaining units for sale,” says L.P.N. managing director Opas Sripayak.
Numerous property developers decided to postpone new projects launches to next year because of the weak market sentiment throughout the year. Also, uncertainty about government stimulus measures back in Q2 2015 did not help strengthen market confidence.
As a result, the number of units launched will drop by 15% this year to 65,000-70,000 compared to 2014. The top locations for new launches were along the extension of the BTS Green line from Bearing to Samut Prakan (15% of new launches), along the new BTS Purple line (10%) as well as prime locations Asok-Phrom Phong-Phra Khanong (10%).
New launches in prime areas still enjoyed a very high take-up rate as condominiums launched in Asok-Phrom Phong sold more than 56% on average at pre-sales event, in spite of THB202,000++ starting prices. Despite sluggish economy, high-end condominiums in Bangkok’s most central locations are still very well-received by Thai and foreign property buyers. A lot of these luxury projects are being introduced to Singapore, Hong Kong or even Taiwanese investors during property roadshows.