Completed condominiums in Thailand’s resort destinations are enjoying strong demand, according to new research from real estate firm Plus Property.
The agency has shone its spotlight on the high demand in the Hua Hin and Cha-Am areas, which it said has been reflected in a high 89 percent take-up rate. This, it said, is a result of the zone’s attractiveness to Thai and foreign visitors alike, as well as the Thai government’s new supportive measures for the property market.
With these seaside properties capably addressing demand for residential units priced under THB 3 million, Plus Property said it expects the addition of 3,000 units during 2016 as developers respond to growing interest in the area.
Poomipak Julmanichoti, Managing Director of Plus Property, revealed the company’s research division conducted a survey of the property market for the second half of 2015 in vacation hotspots that are not too far from Bangkok – such as the Hua Hin and Cha-Am area.
He said the survey found strong demand for finished condominium units in a market with more than 17,380 units available for sale (as of September 2015).
Finished units from 30 projects account for 12,664 units – or 73 percent – of this total while demand-side take-up rates are as high as 89 percent or 11,318 units.
Compared with the same period last year, supply and demand numbers have increased by 145 percent and 162 percent for finished units.
The market for completed condominium units in these vacation areas still has plenty of growth potential thanks to tourism promotion measures, he said, which will drive foreign investors to make a purchasing decision more quickly.
The Thai government’s property market stimulus will also spur higher demand as the majority of residential properties priced below THB 3 million are condominium units on the fringes of Bangkok or beyond.
Provinces that stand to benefit first are tourist destinations such as Hua Hin and Cha-Am, as their economies do not depend so much on fluctuating factors like crop prices.
Furthermore, stimulus policies such as loans through the Government Housing Bank and other financial institutions have led to the appearance of new promotional offers that will inject more cashflow into the market, boost consumer purchasing power and maintain the energy in these tourism hotspots.
“The rising popularity of completed condominium units has brought down the percentage of available supply in Hua Hin and Cha-Am to just 11 percent.” Poomipak said.
“With few developers launching new projects this year, the existing demand gradually bled out of the market. We believe this demand will take one or two years to be completely exhausted.
“Many projects under our management have reached the 100 percent sold milestone this year – including Baan Thew Lom, Baan Peang Ploen, and Baan Imm Aim, which cover a combined 1,300 units.
“Average prices in Hua Hin and Cha-Am now stand at THB 82,997 per sqm, or THB 81,927 per sqm for completed units alone.
“It is evident that the average price of completed units is quite close to the overall market average, and these units have the advantage of being fully ready for inspection and move-in.
“Today, some units are being brought back into the market for resale with a 40 percent price hike up to THB 116,410 per sqm.
“All in all, the market in Cha-Am and Hua Hin is very healthy with Thai and foreign tourists flocking here in droves – especially during long holidays and the high season for tourism, and we expect unit transfers to grow in numbers during the final quarter of the year thanks to the government’s economic stimulus and a growing number of tourists,” concluded Poomipak.
