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Launches slowing, average prices down
Bangkokpost, Friday July 27, 2007

Political uncertainty is reducing the number of new housing unit launches this year, according to Agency for Real Estate Affairs (AREA).

The independent property consulting firm said yesterday that it expected new launches to grow only 2% while it anticipates the Sukhumvit and Rama III areas to be affected by oversupply of condominiums.

Managing director Sopon Pornchokchai forecast 67,630 new units for all of 2007 based on the number launched in the first half of the year.

The total value of new units this year would be around 145.53 billion baht, down by 22% from 186.86 billion in 2006 as developers moved to lower-priced units.

The average unit price this year is expected to be 2.152 million baht.

Condominiums represented 60% of all new units in the first half, up from 49% in the same period of 2006.

About 94% of the units were priced below three million baht a unit.

Outstanding housing supply is now about 98,000 units. About 78,000 are condominiums, with 80% sold, leaving 16,000 units remaining on the market.

Among the total condominium supply, 7,500 units are in Ratchada-Lat Phrao area, 80% of which are sold. There are 17,000 units in the Phloen Chit-Sukhumvit area with 83% sold, and Silom-Rama III has 10,800 units, of which 79% have been sold.

On the west side of the Chao Phraya River, there are 8,800 units, 83% sold. The Onnuj-Soi Baring area had 8,500 units, 80% sold, and areas farther out including Ramkhamhaeng, Rangsit, Thon Buri and Taling Chan had a combined 16,000 units, 71% sold.

Mr Sopon said condominium buyers in the Sukhumvit area should be cautious as land prices are high and most projects targeting foreigners might be delayed due to lack of confidence in the political situation and the economy.

He said buyers should also be wary of the Rama III area as mass transit was limited, although construction has begun on the Bus Rapid Transit (BRT) system.

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