Resale units gain from price hike of new properties

"Resale condominiums in the central business district still record lower prices than new condo projects.

"There is a boost in demand for resale condos from those who want a ready-to-move-in unit," Poomipat Sinachoren, CEO of Bangkok CitiSmart Co, said yesterday.

The company’s sales grew 41 per cent to Bt3.4 billion last year.

The demand for residences is centred on condos in central business districts. Condo owners who bought for investment can nearly double their profit if they hold the asset for more than three years.

For example, a condo on Sukhumvit Road that was priced at Bt90,000 per square meter during the pre-sale phase can fetch Bt110,000-Bt120,000 now that it is available for occupancy.

Buyers can enjoy a return of 22-33 per cent on their investment.

New condos in the same location are going for Bt140,000-Bt150,000 per square meter, which is a challenge for people who need a place to live in. They will decide to buy an existing unit for resale rather than a unit in a project that would take one-and-a-half years or two years to be delivered to them.

Following the increasing demand in the resale market, the company targets growth of 20 per cent a year by focusing only on Greater Bangkok.

The company is managing assets for sale worth Bt20 billion, consisting of condos and low-rise residences including single family homes and townhouses.

The company has shut down its branch in Pattaya, which opened three year ago, when the demand for resale residences was less than estimated.

"Most customers in Pattaya are in the rental market rather than the resale market so we decided to close the business in Pattaya and focus only on Bangkok and suburban markets," he said.

Bangkok CitiSmart, a subsidiary of Asian Property Development Plc, focuses on brokerage, property management and the property agency business.