Bangkok’s Real Estate market has been quiet over the past 2 years.
Market observers noticed that in 2021, the Capital was not blanketed by real estate ads such as roadside billboards and full spread ads in newspapers touting new project launches and real estate offers. But now in 2022 the market has been positively recovering.
A report by international real estate consultancy Knight Frank, the supply of new condo units in by 77.8% in the last 2 years compared to 2019. The report also highlighted prices in the Central Business District fell 5% to THB 251,435 from THB 265,000 per square meter. However, as Thailand reopened we are starting to see prices going back to the pre-Covid pandemic.
The COVID-19 pandemic slammed the property industry, disrupting both local Thai demand and demand from international buyers. This past 2 years have been touch in many aspects, but especially for an industry that thrives on positivity and the promises of a bright future.
Bangkok’s real estate is in the buyer’s market territory and it makes developers uncomfortable, and at the same time creates an opportunity for buyers.
Advise for real estate investors
Just before the pandemic hit in Q1 2020, Bangkok’s real estate market had experienced over 5 years of uninterrupted growth and optimism. Whilst this was incredibly good for developers and to a certain extent great for real estate agents, retail condo investors were caught in the situation of ever-increasing prices.
This upward spiral had the effect of continually decreasing rental yields and gradually decreasing occupancy rates, as new condos over-supply was hitting the market.
This had the negative effect for previous condo investors who refused to sell without a premium, and at the same time, penalizing newer entrants that were caught at the end of the boom.
The pandemic was the catalyst that completely reversed this trend
Suddenly condos, especially on the secondary market but also in newly launched projects (As a result of developer discounts) are starting to look more appealing and rental yields are starting to grow again.
This upward trend is going to continue, as the capital’s leading developers are putting a hold on their downtown condominium projects, reducing new supply. For the first time in a long time, the market has corrected and is offering an investment opportunity to buy low.
Whilst Bangkok’s real estate market is still recovering, those with available capital, have an opportunity to purchase reals state at discounted prices.
The secondary market is offering great investment opportunities at the moment.
2 Examples of the types of real estate deals available at the moment
The Base Park West 77
2 Bed/ 1 Bath/ 48.6 m2, 4.99 MTHB
This 2-bedroom condo in The Base Park West 77 by the developer Sansiri is a beautiful corner unit offering 48.6 square meters of living space. The property provides bright and an airy living environment, with stunning open views of Bangkok.
It is is located in the T77 Community in the up-and-coming On Nut neighborhood. Which is a vibrant area popular with both Expat and Thai residents. It is an area that is popular as it has many conveniences, with supermarkets (Lotus, Big C), shopping malls (Century Movie Plaza and Habito Mall) and a large selection of restaurants, local eateries and coffee shops.
The owner of this property is based overseas and is finding it difficult to manage. Similar unit types in The Base Park West 77 are usually marketed at 5.5-6 MTHB, this unit is offered at a steep 20% discount to current market prices.
Properties similar to this one usually rent for an estimated THB 23-26,000 per month. This means that rental investors would benefit from a 5.5-6.2% Gross Rental Yield.
Prime Mansion Sukhumvit 31
2 Bed/ 3 Bath/ 156.82 m2, 13.7 MTHB
This is a large family-sized 2-bedroom condo in Prime Mansion Sukhumvit 31. The property offers a comfortable and spacious layout. The building is well-maintained and provides a peaceful living environment, with a full range of facilities available to residents.
The property’s biggest selling point is its great location nestled in the heart of the desirable Phrom Phong area. The neighborhood is famous for its trendy lifestyle with numerous restaurants and malls such as Emquartier, Emporium and K-Village. The area has a laid back and pleasant community environment popular with Bangkok’s affluent as well as foreigners.
The seller has owned the condo for many years and is keen to let it go. According to established property portal Hipflat the average price in Prime Mansion Sukhumvit 31 is THB 142,000 per square meter. This is a great opportunity as this condo is offered at an estimated 35% Discount to market price.
Window of opportunity for investment
We are a real estate agency and we are trying to positively highlight the good investment choices available.
Bangkok’s real estate prices have corrected in the past 2 years and are now lower than in 2018-19.
Whilst Bangkok is recovering from the impact of the pandemic, the city still remains an attractive destination to live and work. Basically, Bangkok’s residential appeal remains strong.
As Thailand recovers from the effects of the pandemic, overall the market is moving in a very positive direction, with a nationwide vaccination programme and the reopening of the Kingdom to foreign travelers, Fresh Property is confident that the real estate market will start to regain steam in 2022.
Fresh Property is a full-scope and established Bangkok Real Estate Agency. We offer consultancy, sales, rental and property management services.