The Bangkok high-rise condominium boom has altered the city’s skyline and fueled almost a decade of property market growth driven by overseas investors. However, the ongoing COVID-19 pandemic looks to have put a stop to that in the short-term. Several leading real estate developers are shifting away from condos and looking to tap into real demand in other segments.
That has led many homebuilders to focus their efforts on low-rise residential housing where local buyers remain active. For some developers, this has meant scaling up already existing efforts while others have been forced to switch from the Bangkok high-rise condominium market to low-rise housing. In recent months, luxury housing has been the most in-demand from local buyers.
“After Thailand was hit by the COVID-19 outbreak in early 2020, the single luxury housing market has been one of the fastest market to recover, as evidenced by the sales figures from projects where CBRE has been the marketing and sales consultant,” Aliwassa Pathnadabutr, Managing Director of CBRE Thailand, said. “The main buyers are locals seeking a new home with more living space and privacy following the ‘New Normal’ way of living after COVID-19, taking the living space as well as the internal and external functions into account.”
Sansiri led by low-rise housing
Sansiri has certainly contributed to the Bangkok high-rise condominium boom, but the firm began shifting to housing during the past few years. That helped quite a bit during the first seven months of this year with THB15.4 billion, or 64 percent, of the firm’s total sales coming from low-rise residential housing.
According to a report in the Bangkok Post, Sansiri plans to expand its reach in low-rise housing during the remainder of 2020. The developer is planning to launch as many as 10 new projects this year.
AP not interested in the Bangkok high-rise condominium market
Bangkok high-rise condominium projects are a staple of AP’s portfolio. That being said, the developer has also built up its low-rise housing division, a move that paid dividends in 2020. The developer recorded a 20 percent growth in revenue from low-rise houses during the first half of this year.
The COVID-19 pandemic brought on a further shift in buying habits that AP saw firsthand this year.
“Many buyers shopped around for condo units but eventually decided to buy a townhouse instead after they spent more time working at home during the lockdown period,” AP Chief of Business Group for Townhouses, Pamorn Prasertsan, noted in an interview with the Bangkok Post. “They think living in a condo is too crowded and exercise space is very limited.”
Habitat opts for a change
Habitat Group is a relatively new player to the Bangkok condo market with the firm focusing on projects tailored to Japanese expats and suitable for investment. However, the recent downturn has caused the developer to call an audible and look to low-rise housing.
“The low-rise housing development we are planning will likely be residences or vacation homes. Our locations are in Bangkok and Pattaya, two markets we are strong in,” Habitat Group CEO Chanin Vanijwongse told local media. As the condo market slows down, we should not add new supply to the market or in locations where we’ve launched or developed. Condo buyers perceive that if they buy a unit today, they should have a discount.”
The firm has already announced that it will launch three low-rise housing projects next year on land plots in the Asoke and Phrom Phong areas. These plots were originally slated for condo developments, but Habitat Group decided to switch things up as part of a larger change in strategy.
