Despite the relaxation of quarantine measures in the fourth quarter of 2021, signs of an economic downturn remain. In addition, weak purchasing power hinders the recovery of the real estate market.
Content:
- The real estate price index
- The growing supply index
- Key areas of Bangkok
- Key business findings for the 4th quarter of 2021
- Conclusion
The real estate price index
According to the latest DDproperty report on the Thai real estate market, the residential real estate price index in Bangkok decreased from 183 points to 178 points or 2% compared to the previous quarter (-2% QoQ). This is the lowest figure recorded since the 4th quarter of 2016.
The condominium price index decreased by 2% QoQ and 11% YoY. In contrast, the price index for detached houses increased by 6% YoY while it decreased by 1% for townhouses.
The growing supply index
The number of residential properties in the Thai real estate market has increased from 428 points to 458 points, which is about 7% QoQ (+10% YoY). Multi-story buildings account for most of the supply growth. The index of detached houses increased by 10% QoQ while for townhouses, it increased by 8% over the same period.
Condominiums account for the highest share of supply in Bangkok — about 86%, while detached houses and townhouses account for 8% and 6%, respectively.
Key areas of Bangkok
Price index:
- Khlong Chaokhun Sing — 0%
- Flafla — +2%
- Saphan Sung — +4%
- Wang Thonglang — 0%
- Chorakhe Bua — 0%
- Lat Phrao — +4%
Offer index:
- Khlong Chaokhun Sing — +10%
- Flafla — +20%
- Saphan Sung — +20%
- Wang Thonglang — +14%
- Chorakhe Bua — +8%
- Lat Phrao — +20%
Key business findings for the 4th quarter of 2021
Buyers and long-term investors benefit from the market due to the constant decline in real estate prices, especially for condominiums.
The Bank of Thailand (BOT) has relaxed LTV rules for mortgages.
Despite the general decline in housing prices, land plots bring higher profits as their value increases in this market segment.
Bangkok and its suburbs are areas with the highest increase.
Conclusion
The price index for condominiums is declining as a result of the slowdown in economic growth affecting purchasing power. The decline in the number of domestic and foreign buyers has caused this housing sector to suffer more.
Land plots, especially detached houses, are in high demand as people spend more time at home and want more space to live.
For buyers with high purchasing power, the end of 2021 is still considered the right time to buy a property for living or investing in the long term.
Main reasons:
- Lower prices;
- Attractive interest rates;
- Government policy to reduce property transfer fees;
- The Bank of Thailand (BOT) relaxation of LTV rules for mortgages.