At the time of writing this report, the Thai Government has imposed strict lockdown measures on Bangkok in an attempt to curb a soaring 3rd wave of COVID-19 infections. This has inevitably dampened consumer sentiment and the Bank of Thailand has even revised the country’s 2021’s GDP growth forecasts.
For Bangkok’s real estate market and its weary property professionals, this latest round of lockdowns feels like a repeat of 2020. With many coming to the realization that the “elusive recovery” forecasted for 2H 2021 will most probably not happen so soon.
On that rather somber note… Life must go on!
Bangkok’s real estate market is experiencing a roller-coaster ride and property professionals just need to hold on (… Very tight).
Bangkok Real Estate Report 1H 2021
This report has aggregated and compiled inquiries received by Fresh Property from a variety of marketing channels most notably:
– Dotproperty.co.th/ Thailand-Property.com
– Others (Prakard, Living Insider, etc.)
– Company Website (Freshbangkok.com)
– Inbound Company Calls
– Referrals & Client Database
Social Media Channels
-FB/ IG/ LinkedIn/ Line
The objective of this report was to compare Sales and Rental Inquiries for the periods of 1H 2021/ 1H 2020 and to analyze the following:
- Changes in Inquiry Levels
- Potential Shifts in Budget Ranges
- Neighborhood Inquiry Trends
It is important for readers to note that Fresh Property is a real estate agency focusing its sales and marketing activities mostly on Central Bangkok and popular expat neighborhoods. Here is a list of the neighborhoods we actively cover:
– Phrom Phong
– Phra Khanong
– On Nut
– BTS Saladaeng/MRT Silom
– Chong Nonsi
Rama 9- Ratchada
– MRT Phetchaburi
– MRT Rama 9
– MRT Thailand Cultural Center
Central Bangkok Rental Market Overview
Bangkok is Thailand’s economic heart and it usually benefits from a fast-paced and dynamic rental market. With a steady flux of expat and Thai working professionals all year round. However, Fresh Property recorded a 41% decrease in rental inquiries between the period 1H 2020/ 1H2021.
This was unfortunately expected, COVID-19’s impact on the local economy and travel restrictions inevitably affected the market. The negative impacts were especially severe for Central Bangkok’s rental market as it is primarily expat-led.
The table above shows the total rental inquiries (%) received categorized by budget range. Some interesting market trends that can be observed:
- Fresh Property recorded a substantial decrease in higher priced rental inquiries (40,000 THB and above). With no inquiries over 100,000 THB per month received since the beginning of the year.
- The Agency has experienced an increase in low-level inquiries (10- 20,000 THB) and affordable inquiries (20-40,000 THB per month). The biggest increase was for properties between the 20-40,000 THB price range; this was likely driven by rental demand for 2-bed condos available at this price range.
- The rental team has experienced an increase in renters looking to downsize or looking for more affordable rental properties. It is also important to note that several landlords have reviewed their rental rates downwards, resulting in a correction in rental prices across Bangkok.
The table above shows the distribution of rental inquiries (%) for each neighborhood under Fresh Property’s coverage during period 1H 2021. Some interesting observations to note:
- On Nut remains our Agency’s most popular rental neighborhood. This area also came out on top in a market report we conducted back in 2018. The popularity of On Nut is likely because of its travel convenience to Central Bangkok and the large selection of modern condos priced at low-level/ affordable rental rates (I.e., Only 10-15,000 THB for a 1-Bed).
- Bangkok’s prime locations notably Thonglor, Asoke and Phrom Phong remained popular rental destinations. Over the past year, Fresh’s rental team has experienced renters looking for discounted rental properties in the Central Business District. With many renters taking advantage of the price correction and upgrading their lifestyles, while maintaining or even reducing their cost of living.
Central Bangkok Sales Market Overview
Bangkok’s sales market was also affected by the current situation; Fresh Property recorded a 36% decrease in sales inquiries between the period 1H 2020/ 1H2021.
Pre-2019 the property agency had a stable international market of buyers, especially from Hong Kong, Singapore and the UK. However, inquiries from international buyers have dramatically decreased as a result of the pandemic.
Interestingly, the decrease was not as large as rental inquiries and the reason for this is an increase in inquiries from the local Thai market. As many Thai investors and homebuyers, have been using the depressed market conditions to look for “good deals”.
The table above shows the total sales inquiries (%) received categorized by budget range. Here are some interesting trends to note:
- Fresh Property recorded a big decrease in inquiries for the price ranges 2.5-5 MB and 5-7.5 MB; these price ranges are usually middle-income price brackets and this income group was likely the most affected by the pandemic.
- There is a surprising increase in the higher budget ranges of 7.5-10 MB and 10MB+. Upon further analysis, these inquiries were mostly from Thai homebuyers looking for larger 2-bed and family-sized condos.
- The outlier <2.5MB budget range is showing a small increase; after looking at the inquiries, our Agency notes that this was mostly from foreign buyers that were looking for “discounted properties”.
The table above shows the distribution of sales inquiries (%) for each neighborhood under Fresh Property’s coverage during period 1H 2021. Here are some general observations:
- The Agency experienced a high number of inquiries for condos and properties in Phra Khanong; the area is a residential commuter hub, popular with working professionals that work in the Central Business District. This increase was likely because of a large influx of good-value property listings that were advertised during this period.
- Central Business District locations remain the top “go to” neighborhoods for buyers, especially during these uncertain market conditions. The agency experienced a large increase in inquiries for properties in Asoke, Phrom Phong and Thonglor. These 3 areas are lifestyle and business hotspots usually popular with affluent working professionals.
Bangkok Market Outlook for 2H 2021
Uncertainty will continue to cloud the Central Bangkok property market over the next 6-months. Any predictions on the exact timeline of a recovery is pure speculation and guesswork at present.
A few major Bangkok Real Estate trends to note for 2H 2021:
- Developers will continue to scale back on high-rise projects in the Central Business District. With most developers focusing on low-rise housing projects in Outer Bangkok.
- The rental market is likely to continue to be a tenants’ market; with landlords having to accept discounted prices on their rental investments.
- The resale market is likely to continue to be a buyers’ market; these buyers are likely going to be predominantly Thai. Most of these buyers will be looking for “discounted deals”.
The biggest factor to watch is the ability of the Thai Government to curb the latest 3rd wave of C-19 infections over the coming months.
Fresh Property is a Central Bangkok focused real estate agency offering consultancy, sales, rental and property management services. If you have any questions about this report, feel free to contact us on email@example.com.