Will 2013 be the year of mid-range property in Thailand?
News by Propertyshowrooms.com
Mid-range property in Thailand has been somewhat repressed since the global financial crisis took hold in 2008, but 2013 could be the year for its resurgence. Nigel Cornick, former chief executive officer of Raimon Land and current boss of Pattaya-based development company Kingdom Property, told the Phuket News that the market segment will see a rise in activity this year.
“I believe it will come back because Thailand is now seen as less risky,” he said. “We’ve seen that to some extent in Southpoint where the Japanese have bought around 20 units. Russians are also buying, and we are selling two-bedroom units for up to B9 million (£1.8 million).”
It is the Russians that are helping to drive mid-range property at the moment, according to Mr Cornick, with the Thai middle class coming up close behind. Consequently, developers are eager to take advantage of this emerging market and local developers are beginning to intensify operations. Sansiri is just one business looking to increase their mid-range offering, with eight projects in Phuket currently indevelopment, the Phuket News reported.
“I don’t think it will be long before people like Sansiri will step it up a pace [at the lower end of the market] in Pattaya, because Pattaya’s got that backdrop of the eastern seaboard, the industrial base, where you have people with the potential to buy a condo for B1 million-plus (£204,498 approximately),” Mr Cornick added.
However, the market may not be able to sustain current levels of development, with construction costs continuing to rise in the country. This will drive up the project overheads and sale values, potentially pricing many out of the market.
Teamed with mixed signals about the state of the property sector in Thailand at the moment, buyers can be forgiven for being cautious. In September 2012 the Global Property Guide reported a 1.15 per cent decrease in single detached house prices during the year-to-end-Q2, based on figures from the Bank of Thailand. However, the country is increasing in popularity as a holiday destination and holds significant rental income opportunities. International Property and Real Estate News from Propertyshowrooms.com
2013-01-14 17:46:46
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