Weak H2 'to curb growth of city property market'
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The property market in Greater Bangkok is expected to contract 10 per cent in the second half of this year, but should manage to show 4-per-cent growth for this whole year, according to the Agency for Real Estate Affairs.
“Demand in the latter half could be 10-15 per cent lower than the first half. But if the economy remains buoyant, demand could be as good as in the first quarter,” Sopon Pornchokchai, president of AREA, said yesterday.
The first half saw fewer real estate projects in Bangkok and surrounding areas than last year.
The lower average unit price of residential estates in the first half compared to last year – Bt2.74 million versus Bt2.94 million – suggests the market is entering a slowdown, he said.
Throughout this year, launches are expected increase 12 per cent by volume to 113,584 units and 4 per cent by value to Bt310.77 billion.
In the first half, 61,540 units were launched with combined value of Bt167.99 billion.
In the first half, 69 per cent of the units sold in Greater Bangkok were apartments due to limited land, convenient transportation and the flood in the suburbs. Townhouses accounted for 19 per cent and single family homes for 8 per cent.
Developers are urged to pay more attention to down payments to prevent financial problems as more mortgage loan applications are rejected. Developers should increase deposits to 15-20 per cent of house prices.
All projects should also open escrow accounts to protect deposits in case property projects cannot deliver completed units.
