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Budget condo index outpaces market

The price index of condominium units priced below 50,000 baht a square metre has risen 10% this year despite the large new supply, against a rise of just 6% in the condominium price index overall.

Samma Kitsin, director-general of the Real Estate Information Center (REIC) said the lower-priced segment was healthy though it had slowed a bit since the Bank of Thailand announced new caps on mortgage lending last year.

The lower-end segment showed the highest increase in the index among all price segments, after rising only 1.47% in the first half of last year.

In the segment above 80,000 baht per sq m, the index rose only 3% but reversed a decline of 0.29% in the first half of last year, as buyers in this segment are mostly foreigners sensitive to political unrest.

Mr Samma said the rise in the condo price index was higher than the inflation rate, currently at around 4%.

“Buying when inflation is rising is a good investment as property values are always higher than inflation but it also depends on location,” he said.

He said Chaeng Watthana was one location where housing values were rising sharply. A two-storey single house on a lot of 50 square wah on Chaeng Watthana Road cost less than 300,000 baht in 1980 but the price today is 3 million.

“Housing in Chaeng Watthana area had good sales as it is a source of new workplaces along the route,” he said.

The Ratchadaphisek-Rama IX area, Makkasan and Bang Sue will become hot locations in the future as commercial development spreads. Bang Sue will have high potential as three mass-transit lines would meet there.

Kessara Thanyalakpark, director of Sena Development, said homebuyers should choose locations where prices dropped only slightly when the market declined and rose sharply when the market was on an uptrend.

“These locations are in walkable neighbourhoods or within walking distance of schools, parks and shopping areas and depend less on vehicles.”

Source: Bangkok Post

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