Although the number of unsold units in the Cha-Am, Hua Hin and Pranburi areas is a major concern for developers in the area, according to the latest real estate report from Colliers International (Thailand), demand in the region is not expected to decline during the coming year.
The agency noted that approximately 9,000 houses and condominium units are still available in the market. It said that some condominium projects faced trouble after some investors declined to transfer their units. Some developers have also opted to postpone launches for the time being.
Colliers reported that property developers were more concerned with the demand situation, so most held off on launching their new projects last year. It said only 1,928 condominiums and houses were launched during last year however, the average take-up rate of both condominiums and houses still continued to grow. Approximately 74 percent of all houses were sold, a slight increase from the previous year, while the average take-up rate in the condominium market was approximately 72 percent.
Colliers said that many units were launched during 2015 and this affected the average take-up rate. It added that demand in the area declined last year and predicted that it will not dramatically improve during 2016.
Average prices in the condominium and house markets during 2015 only increased by between three percent and five percent from the previous year.
It added that developers are trying to attract more buyers during the market slowdown by keeping the same selling prices or by increasing them only slightly. Some condominium developers are also facing a transfer issue, so are discounting their units for all ready-to-transfer buyers.
Large-scale projects in Cha-Am and Hua Hin are probably creating interest, with some water parks and shopping malls adding more interest to the area. Some new infrastructure projects by the government, such as the Bangkok – Hua Hin high-speed train and the new ferry pier for services on thePattaya-Pranburi route also adding interest levels in the long-term.
Forecast
Property developers will postpone launching their new projects during 2016, according to Colliers, and will wait for the market to recover for a better economic overview.
Property prices in 2016 will be similar to 2015 or increase only a few percentage points, while new house and condominium projects in 2016 will also not be priced significantly higher than old projects in the market.
Colliers said that all property markets in Thailand have slowed, but Cha Am, Hua-Hin and Pranburi have still continued to grow slightly in the past year. The demand in the area may not significantly improve, but also will not sharply decline during 2016.
Both house and condominium units that are selling for less than THB 5 million per unit are still in need for all buyers in 2016. Some private, large-scale projects in Cha-Am Hua Hin and Pranburi will probably create interest in area.
