by wilbersuen | Oct 16, 2024 | News
Vimarn Suriya Co, the developer behind the luxury mixed-use Dusit Central Park project, remains unfazed by rising interest rates and a strengthening baht, as the branded residential development primarily targets affluent Thai buyers.
CEO La-ead Kovavisaruch noted that elevated mortgage rates have a minimal effect on luxury homebuyers compared to those in the mass market.
“Demand in the luxury segment remains robust, while supply, particularly in prime locations, is quite limited,” she commented.
Currently, 80% of The Residences at Dusit Central Park, valued at 11.5 billion baht, have been sold. The company anticipates reaching 85% by year-end.
The project comprises 406 units, starting at 55 square meters, with an average price of 380,000-390,000 baht per square meter.
There will be seven penthouses, including six units of 450 square meters and one expansive 900-square-meter unit. Two 450-square-meter penthouses and the 900-square-meter unit are still available.
“The 900-square-meter penthouse offers customization options, allowing buyers to tailor the number of bedrooms,” said Ms. La-ead.
“We are in the process of selecting a luxury brand to collaborate on marketing this unit.”
She added that the recent strength of the baht would not affect sales, as 80% of buyers are Thai nationals.
“The baht has fluctuated between 32 and 37 baht to the US dollar over the last two to three years, so the current rate hasn’t impacted our project,” said Ms. La-ead.
“Our key customer base is Thai, which means currency fluctuations affect us less compared to foreign buyers.”
The company expects the project to be fully sold by 2025, with construction scheduled for completion by the end of that year.
Source: Bangkok Post
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The editorial team at Invest Bangkok Property
by wilbersuen | Oct 9, 2024 | News
Rising house prices, driven by increasing construction costs, are having a lesser impact on potential homebuyers than the growing challenges in obtaining mortgage loans, according to property associations.
Pornarit Chounchaisit, President of the Thai Real Estate Association, noted that the surge in costs reflects a global trend, with property prices climbing in major cities worldwide.
“The war and its influence on oil prices are escalating construction costs for new housing projects,” he said. “Moreover, rising labor costs will further drive up housing prices.”
Although selling homes remains difficult, housing prices are expected to increase next year due to the government’s planned wage hikes. However, this policy is likely to benefit foreign workers, who constitute 50-60% of the labor force, more than local labor.
Soonthorn Sathaporn, President of the Housing Business Association, emphasized that the increase in housing prices has not outstripped inflation.
“The real challenge lies in stricter lending criteria, which are preventing many potential buyers from securing mortgages,” he said.
He also pointed out that mortgage rejection rates have surged to 35%, up from the usual 15-20%, with rejection rates reaching 50-60% for homes priced between 2-3 million baht.
Some developers have had to reduce their profit margins to make homes more affordable and are expediting construction to control costs.
To boost demand, Soonthorn urged the government to extend the expiring property measures and introduce income tax deductions for first-time homebuyers. He also suggested that relaxing loan-to-value (LTV) regulations could stimulate second-home purchases, particularly for properties near schools and workplaces.
Prasert Taedullayasatit, President of the Thai Condominium Association, supported the call for temporary relaxation of LTV rules to encourage market growth, proposing that the government withdraw these measures if speculative behavior is observed.
“A reduction in interest rates would also enhance purchasing power, especially for lower-income buyers, while a weaker baht could boost tourism and attract foreign property buyers,” he added.
To further stimulate demand in Q4, the three associations are organizing the House & Condo Expo from October 31 to November 3 at the Queen Sirikit National Convention Center. Their goal is to sell at least 1,000 units, totaling over 4.5 billion baht in value, and they expect an additional 10 billion baht in sales in the months following the event.
Source: Bangkok Post
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The editorial team at Invest Bangkok Property
by wilbersuen | Oct 8, 2024 | News
Thailand is poised to transition to a cashless society faster than its regional counterparts, driven by the nation’s rapid adoption of digital technologies, according to a survey by Visa.
Visa, a leading global provider of digital payment services, recently conducted the Consumer Payment Attitude Study, which indicates that Thailand could become cashless by 2028, ahead of the broader ASEAN region, which is expected to reach this milestone after 2028.
The survey found that 22% of Thai consumers believe a cashless society will emerge between 2026 and 2028, compared to 16% of consumers across ASEAN.
Thailand ranks third in the region for carrying minimal cash, with cash accounting for only 47% of the content in each respondent’s wallet, trailing behind Vietnam (56%) and Malaysia (49%).
Punnamas Vichitkulwongsa, Visa Thailand’s country manager, noted that the development stage of payment technology in each regional market is critical for advancing towards a cashless society. In Thailand, PromptPay, the national payment platform, has significantly driven digital banking adoption, especially during the post-pandemic period.
The survey also revealed that Thailand leads the region in mobile banking app usage, with an impressive 97% of Thai consumers using these apps at least once a week, surpassing Vietnam (95%) and Indonesia (90%).
Real-time payments (RTP) are growing rapidly, with 76% of ASEAN consumers aware of RTP and 47% having used it for fund transfers. Thailand leads the region in RTP usage frequency, with 86% of respondents making at least one RTP transaction per week, followed by Vietnam (84%) and Indonesia (69%).
Mr. Punnamas attributed the growth of RTP in Thailand to PromptPay, which has enhanced digital payment adoption and supported Visa’s business in the market. Thai consumers are becoming increasingly comfortable with digital payments, including Visa credit cards.
However, he acknowledged that PromptPay’s success has affected Visa’s business in Thailand, particularly in the debit card segment. The cancellation rate of Visa debit cards has increased post-pandemic, largely due to the rising influence of PromptPay.
“Approximately 20% of Visa debit cardholders have not renewed their cards after expiry during the post-pandemic period. However, this figure is expected to decline as debit cards remain essential for specific customer segments,” he said.
Given the country’s high household debt and limited access to credit cards for certain retail borrowers, debit cards remain a crucial digital payment option for this segment.
Mr. Punnamas further shared that Visa Thailand plans to launch Click-to-Pay, a tokenized payment system, next year to enhance card security and reduce fraud. This innovative solution will eliminate the need for a 16-digit card number.
Source: Bangkok Post
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The editorial team at Invest Bangkok Property
by wilbersuen | Oct 7, 2024 | News
Sales of second-hand condos in Thailand’s Eastern Economic Corridor (EEC) are performing well.
According to the Real Estate Information Center (REIC), the number of second-hand condo transfers in the EEC provinces increased in the second quarter of 2024 compared to both new condos and new and second-hand low-rise houses, with the majority of activity focused on units priced below 5 million baht.
Siddhipen Siddharthapong, acting assistant director-general, stated that this trend indicates a limited budget among homebuyers in Chon Buri, Rayong, and Chachoengsao, driven by a sluggish economy.
“When the economy slows, second-hand homes often perform better in the market due to their lower prices compared to new units and more desirable locations,” she explained.
“Second-hand condos are more appealing than second-hand low-rise houses, as potential buyers either cannot afford the latter or find that similarly priced options are too far from their workplaces.”
REIC’s data shows that second-hand residential unit transfers in Chon Buri, Rayong, and Chachoengsao amounted to 12,033 units valued at 29.5 billion baht in the second quarter of 2024, a decline from 12,532 units worth 32.8 billion baht in the same period last year.
The most significant drop was seen in low-rise houses, with transfers falling to 8,390 units worth 21.1 billion baht, representing declines of 5.2% in units and 6.3% in value, compared to 8,846 units worth 22.5 billion baht previously.
Condo transfers by unit number fell slightly by 1.2% to 3,643 units from 3,686 units, but the value declined more sharply, decreasing by 18.3% to 8.36 billion baht from 10.2 billion baht.
This indicates that while demand remains robust, buyers are focusing on lower-priced units.
Among categories, only second-hand condos saw an increase, rising 17.7%, whereas new condos, new low-rise houses, and second-hand low-rise houses recorded declines of 14.8%, 6.1%, and 4.5%, respectively.
In terms of pricing, new condos priced below 1.5 million baht were the only segment to experience year-on-year growth, with units below 1 million baht increasing by 35.1%, and those priced between 1 and 1.5 million baht rising by 13.9%.
Source: Bangkok Post
Yours sincerely,
The editorial team at Invest Bangkok Property
by wilbersuen | Oct 2, 2024 | News
The share of pre-owned home transfers in Greater Bangkok has increased for two consecutive quarters, driven by weakened purchasing power due to the economic slowdown, according to the Real Estate Information Center (REIC).
Siddhipen Siddharthapong, acting assistant director-general of the REIC, noted that many homebuyers, particularly in the lower-end market segment, were unable to find homes at their desired price points, leading them to choose more affordable alternatives.
“Pre-owned homes are generally priced lower than new ones of similar size and location,” she stated.
“Given the high household debt and interest rates, many homebuyers are opting for more cost-effective second-hand properties.”
As per the REIC, 21,504 low-rise houses in Greater Bangkok were transferred in the second quarter of 2024, with a total value of 93.2 billion baht—representing a year-on-year decline of 13.5% in volume and 5.6% in value.
The largest decreases were seen in homes transferred by companies, which the REIC considers new homes, with the number of units dropping by 22.5% to 9,087, and value falling by 7.8% to 56.9 billion baht.
Meanwhile, transfers of homes by individuals, categorized as pre-owned homes, declined by 5.5% to 12,417 units, with the value falling by 1.9% to 36.3 billion baht.
The proportion of transferred pre-owned low-rise houses rose to 57.8% in Q2 2024, up from 57.3% in Q1 and 53% in Q4 2023.
For unit sales, the largest increase during the period was seen in units priced over 100 million baht and those between 80-100 million baht, rising by 300% and 150% to four and ten units, respectively. Both categories comprised new homes.
For the pre-owned segment, homes priced above 100 million baht saw the highest year-on-year growth, increasing by 125% to nine units.
Among new homes priced below 80 million baht, units priced between 20-60 million baht increased, while other price categories declined, with units below 1 million baht experiencing the sharpest decline, down 47.2%.
For pre-owned properties, units priced below 3 million baht, between 7.5-10 million baht, and between 20-60 million baht also saw a year-on-year decrease.
According to the REIC, transfers of low-rise housing better reflect market trends than condominiums, as these involve shorter-term decisions made by buyers within approximately six months due to the shorter construction timeline.
Source: Bangkok Post
Yours sincerely,
The editorial team at Invest Bangkok Property
