This has been a difficult year for the Bangkok condo market with the COVID-19 pandemic compounding issues such as oversupply and tighter loan limits. However, the situation has kick started the correction process, something many experts and developers believe to be a silver lining with long-term benefits.
“Good sales performances after heavy discounts have made many developers realize that, in recent years, condominium prices have been mismatched,” CBRE Thailand Managing Director Aliwassa Pathnadabutr explained to the Bangkok Post.
Many homebuilders have turned to discounts in order to shift units in existing developments. This has seen the bloated Bangkok condo market start to clear some inventory and also proved to be a learning moment for developers.
“Developers are realizing that prices of condos, especially in Bangkok and other major cities, have exceeded the affordable level of locals. Before the pandemic, without domestic demand, developers could depend on foreign buyers,” Aliwassa noted. “At this point, they need to lower their price point to match locals’ purchasing power.”
She added that the Bangkok condo market correction is expected to carry over into 2021 and perhaps even longer in order for things to return to normal. Despite this, a lack of new condo launches this year meant demand has been stable even if firms needed to slash prices to entice buyers.
“Discounts will continue until the market fully recovers. We have seen many developers report healthy presales revenue in the second quarter of 2020, which helped them get through tough times,” Aliwassa said.
Developers think differently to find Bangkok condo market success
For homebuilders wanting to offload condo units in Bangkok, discounts are just one part of the process. They also need to be willing to think differently in these challenging times. An example of this was the Dot Property Black Friday Sale which took place earlier this year.
Several Bangkok-focused developers took part and found great success in closing deals during the 12-hour, online-only event. One participant, Asset Wise, sold several condo units in one over the course of a few hours.
“We are delighted with the Dot Property Black Friday Sale. The fact we sold several units in Modiz Sukhumvit 50 in only 12 hours shows Dot Property truly understands the needs of buyers. Our success also proves there is real demand for Thailand property so long as you offer the right product at the right price and work with a partner who understands the market like Dot Property,” Asset Wise Assistant Vice President, Khun Sineenuch Sriumnouy, explained.
Risland was another Dot Property Black Friday Sale participant. The firm moved THB12 million worth of condo units in The Cloud Thonglor Petchburi during the sale. Having an audience of engaged property seekers made sure their discounts mattered.
“The Dot Property Black Friday Sale was a unique event that really captured the attention of real estate buyers. Our team was blown away by the response we received for The Cloud Thonglor Petchburi. We managed to sell nearly THB12 million worth of condo units in the project during the sale. That can be attributed in large part to the comprehensive marketing efforts and reach of Dot Property who knows exactly where the demand for Thailand property is coming at all times,” Chao Zhong, Project Director of The Cloud Thonglor Phetchaburi, stated.
