The prospect of acquiring land in the heart of Bangkok has turned more competitive than ever, among other takeaways from new research by CBRE Thailand.
Bangkok plots are projected to become more highly coveted than ever, with major central business districts (CBD) in the Thai capital breaking land value records.
Meanwhile, the metropolis is steeling for an uptick in foreign investment this year, even as local developers increase marketing campaigns in search of overseas demand.
The Ploenchit-Lumpini CBD showed the highest land inflation last year, with prices peaking at an unprecedented THB1.9 million (USD54,200). Record highs were also seen along Sukhumvit Road (THB1.75 million) and in the Silom-Sathorn area (THB1.45 million).
Such record increases owe to ongoing significant demand for downtown condominiums. “CBRE Research is confident that the land price record will be broken again in each CBD location,” the report stated.
Prices of future, off-plan condominium units are slated to top last year’s average price of THB247,613 per square metre. In Central Lumpini, prices of off-plan condo units hit THB250,363 per square metre, the highest ever recorded for Bangkok since 2010. Similarly, resale units are likely to top prices of THB198,482 per sqm.
More: What you need to know about Bangkok real estate for 2017
Although CBRE places confidence in a strong buying sentiment for high-end and luxury condominium projects this year, it is worth noting that the number of newly launched units in the downtown areas suffered an 11 percent drop between 2015 and 2016. In addition, buyers will become “more selective,” the report stated.
Thais will continue to drive most of the demand, as with last year, when locals comprised 85 percent of property buyers. However, as developers make inroads into overseas markets, international buyers are also projected to pour into the city’s luxury segment this year. In 2016, units valued up to THB10 million proved popular among foreign buyers.
“Thailand has the added benefit of no punitive stamp duties for foreign nationals, unlike markets such as Singapore and Hong Kong,” CBRE stated.
As to how Thailand’s vivacious capital city will grapple with rising uncertainty in global geopolitics, CBRE acknowledged that the US administration’s protectionist trade policy toward China represents a “major risk” to the economy this year. “Lower volume of Chinese exports to the US in turn reducing Thai shipments of raw and manufactured products to China for re-export,” CBRE explained.
Here’s a great infographic on the outlook of the Bangkok market in 2017:
Source: Property Report