Northeast sitting on oversupply of homes, says GHB official

Vichai Viratkapan, an inspector at the bank and acting director-general of its Real Estate Information Centre, said there were 16,206 units available in Udon Thani, Ubon Ratchathani, Khon Kaen, Nakhon Ratchasima and Maha Sarakham in the first half of 2019, including 12,472 single-storey homes in housing estates, 3,496 condominium units and 238 villas. 
Of those, 13,327 were unsold, a 0.9-per-cent drop from 2018, representing a Bt50.96-billion investment value.
“The unsold units were in 316 projects, including 10,382 in housing estates and 2,779 condos, and most of them in Nakhon Ratchasima,” Vichai said.
He expressed concern about the substantial supply remaining unsold from 2014 to early 2019, such as the 1,140 units waiting for buyers in Nakhon Ratchasima, Khon Kaen and Udon Thani.
“The worrying condominium stocks in Nakhon Ratchasima are in the area of Khao Yai National Park, where there are also 211 villas available. In two other provinces, there is stock remaining from three years ago – particularly condos in Udon Thani – and yet buyer demand still isn’t satisfied.”
Current supply is close to the average of the past five years of 13,000 units, suggesting that oversupply in the future will be no higher. 
“The most worrying issue, though, is condos for sale at Bt2 million-Bt3 million that are being purchased at a lower rate than the average in the past,” Vichai said.
He said the Northeast was projected to have 9,574 units available in 2020, including 7,233 in housing estates and 2,341 condos. 
“Single houses will make up 45.6 per cent of the total, townhouses 24.5 per cent and semi-detached houses 14.2 per cent.”
Vichai predicted that the government’s stimulus package for the property market, which will reduce transfer fees and mortgages throughout 2020, will boost sales by end of next year. 
“Around 180,000 units will be affected by the positive impact of this measure, allowing the overall market to turn positive in 2020,” he said.