Those looking to buy property this year in Thailand will face much higher prices than last year, mainly because of the increased costs of construction, land and taxes, a report by international property consultants CB Richard Ellis in Thailand reports.
The Thai Kingdom's property and real estate market is expected to remain robust and climbing, despite stricter zoning guidelines, the report says. Particularly buoyant demand will prevail in the low to middle income brackets, with the highly popular Baan Ua Athorn project moving into new phases.
Developers will face increasing costs, the report says. However, sales of high-end housing products are expected to slow after a flurry of activity throughout the past three years. Sales will likely remain strong, but it may take longer to complete pre-sell deals than it did last year.
Continued demand is largely attributable to the improved state of the Thai economy, increased incomes in Thailand, greater job stability and the prevailing low interest rate environment and new property areas have also been opened up for residential development, it said.
The report predicted the hotel sector would continue to grow, thanks in large part to the increased numbers of tourists to Thailand every year. the report also suggests that Thailand has a great potential for branded resort hotel development in tourist places other than Phuket and Koh Samui.
CB Ellis global research consulting director Amy Rodil said there was sufficient demand for property supply to continue to increase, but suppliers had to match potential client's expectations in terms of location, size, design and affordability.
Amy Rodil also said the condominium market was expected to become more competitive, as supply continues to increase. There are 4,000 new condominium units slated for construction in downtown Bangkok this year, compared with only 1,000 last year and at least 2,400 new condo units will be on the market by the end of 2004, the report says.
The rental market in Thailand, ostensibly aimed at foreigners, should remain very stable because of an increase in demand. Yet older apartments in need of refurbishment will suffer this year, and demand for professional real estate managers is increasing.
CB Ellis executive director James Pitchon said office buildings were among the best options for investors, as rents are on the up as vacancies fall and tenants have less choice. Activity in the retail sector is expected to intensify upon completion of the Siam Paragon shopping complex and the renovation of various centers, including Central World Plaza and Erawan Bangkok.
