Housing prices are rising in the Silom-Sathon area due to higher land value and condominium projects.
This is according to results of a real-estate survey released by property and facility management agency Plus Property.
The most recent price for land in the area was found to be Bt1.45 million per square wa, with condominiums commanding prices of Bt200,000-Bt300,000 per square meter.
The area’s location as a business district, surrounded by the offices of leading companies, famous schools, hospitals and government agencies, has attracted both Thai and foreign buyers. They include homeowners and investors, with the rental market showing a 5 percent annual return on investment and average resale prices increasing 7 percent per year over the past five years.
Anukul Ratpitaksanti, Plus Property managing director, said the survey had identified that the Silom-Sathon area had high potential.
Despite possessing limited land for development, the area is experiencing “interesting growth” in condominiums, with a supply of 6,786 units available in the first half of 2017, Anukul said.
At present, the average price of Silom-Sathon condominiums is quite high due to limited land and continual price increases, contributing to rising capital costs of investments for project development, the company said.
New projects located near main roads or mass transit lines feature prices of 200,000-300,000 per square metre, which continue to attract interest. During the past three years, only five new projects were opened in the area, but they boasted average sales of up to 85 percent during their first six-month opening periods.
The survey found that the rental market continues to attract significant interest due to condominiums in Silom-Sathon generating high returns on investment. A condominium unit priced at Bt6.5 million can be rented for Bt30,000 per month, providing an average 5 percent annual return on investment.
The current average rental rates for Silom-Sathon condominiums located near mass transit lines is Bt700-Bt1,000 per square meter. For property purchased for resale, it was found that during the past five years a one-bedroom unit commands a resale price of about Bt210,000 per square meter, while a two-bedroom unit has a resale price of about Bt200,000 per square meter.
The current land price in the area is Bt1.45 million per square wa, with an appraised price of land located on Sathon Road, especially land near roads or mass transit lines, growing an average of 78 percent from 2008 to the forecasted 2019 period. Land on Silom Road has increased 53 percent during the same time range.
“Although the Silom-Sathon area features convenient transportation, including the BTS and MRT, the number of mass transit users is growing every year, with information from BTS Group Holdings indicating that the number of BTS passengers is growing an average of 3-10 percent per year,” Anukul said.
“People working in this area seek real estate to live near their workplaces, in order to avoid heavily used mass transit systems and rush-hour traffic congestion. The forecasted demand for real estate in this area is expected to increase due to buyers’ desire to avoid tiring commutes and travel costs, as well as the proximity and easy access to nearby lifestyle venues, department stores, and world-class restaurants.”