Due to a decline in purchasing power among lower-income people over the past year and growing number of rejections on mortgage applications, developers in Thailand are now putting their major focuses on the upmarket. The focus reflects the real estate trends that apply to both the Thai demographic as well as foreign buyers.
In the Thai market, an example of this trend can be seen in new developments by Phupobfa, a company that plans to develop a luxury villa project in Khao Yai. Targeting high-net-worth Thais, the project, called Creston Hills Residence, will be worth 4 billion baht and will have 57 units, each starting at 55 million baht. Khao Yai is currently a growing resort destination as it is located close to Bangkok but enjoys similar weather to that of Thailand’s Northern provinces. Demonstrating the demand for luxury weekend homes for Bangkok’s elite, the project is already 30% sold, with sales expected to close by the year’s end.
In the foreign market, the residential property developer Sansiri just reportedly revised its business plan to focus on mid- to upper-income buyers, with a strong focus on marketing to those who live overseas. For example, the company expanded its investment overseas by buying an apartment building in London for the second time in five years.
Located within Thailand itself, Sansiri’s joint venture with BTS Group Holding – BTS Sansiri Holding One is already planning on launching three new condominium projects, a combined total of at least 10 billion Thai Baht. The condominiums will be located in some of Bangkok’s most coveted and up-and-coming locations; all within walking distance of the growing BTS and MRT routes.
As land prices in these areas are expected to rapidly appreciate once the mass transit routes are extended, they are prime locations for luxury projects as well. Sansiri also reportedly plans on increasing the prices of their residential properties by five per cent this year, following the rise in land prices.
