Mass transit still dictating condo choices
Existing or planned routes for the BTS and MRT have been the developers’ favourites, and buyers are getting on board
The presence of mass-transit routes continues to be the main factor influencing condominium developers’ decisions in Bangkok. The latest figures show that 85% of all condominium units launched in the first quarter of this year were near existing, under-construction and planned BTS or MRT lines.
A total of 13,737 new condominium units were launched in the first quarter in Bangkok, with 6,079 sold for a take-up rate of 44.2%. It was noteworthy that every one of the newly launched premium and Grade A condominium buildings was located near an operating mass-transit route.
Of the total newly launched units, 6,504, or 47%, were located along a currently operating mass-transit route. Another 5,157 units, or 38%, were located along a future mass-transit route. One-quarter of these units will be located along the MRT Dark Blue Line (Hua Lamphong-Lak Song), followed by 20% on the MRT Yellow Line (Lat Phrao-Samrong) and 19% on the MRT Purple Line (Tao Poon-Klong Bang Phai).
In areas of the capital where there are no mass-transit routes, developers launched only 2,076 condominium units, or 15% of the total, in the first quarter.
The highest take-up rate was seen in areas with operating mass transit, averaging 52% of units sold. In areas with no mass transit, sales averaged 40.4% of the total, while the figure slipped to 36.1% for condominiums located along future mass-transit routes.
Among the operating routes, the best sales performance is in the area along the MRT Dark Blue Line, with a take-up rate of 65.2%. The majority of newly launched units along this route were in the Lat Phrao-Phahon Yothin and Sam Yan areas.
The hottest location along the BTS Light Green Line was the so-called Late Sukhumvit, the eastern stretch connected to Bang Na. The major drawing card in the area is the 20-billion-baht Bangkok Mall that The Mall Group is developing on a 100-rai plot opposite the Bitec convention centre on Bang Na-Trat Road. The complex will include a shopping mall, offices, hotel, serviced apartments and an exhibition centre.
The average selling price of newly launched condominium units along now operating mass-transit routes was 162,949 baht per square metre in the first quarter. In this category, the most expensive area was Central Lumphini, home to some ultra-luxurious developments averaging 320,000 baht per m².
Along future mass-transit routes the price averaged 76,410 baht per m² but history shows that condo prices climb significantly as completion of the lines approach. The highest average selling price along future mass-transit routes was along the Purple Line, at 110,345 baht per m².
Average selling prices along future mass-transit routes vary depending on the distance to the future station. For buildings located less than 120 metres from a station, units averaged 92,933 baht per m². For distances between 270 and 300 metres, the average was 72,290 baht per m². For buildings located on a transit route but two kilometres or more from a station, the average fell to 43,378 baht per m². The highest selling price was along the MRT Purple Line (Tao Poon-Klong Bang Phai), at 110,000 baht per m².
Among new Grade B and C condominiums, studio units make up about 10% of the total, compared with only 2.5% in Grade A buildings. At the latter, 80% of the units on offer are one-bedroom and 16% have two bedrooms. In Premium Grade buildings, two-bedroom units account for 90% of the total.
In Grade B buildings, two-bedroom units will account for 13.3% of the total, compared with only 6.2% in Grade C condominiums.
Overall, location continues to dictate prices and resale values in the Bangkok condominium market. Condominiums located in the central business district and city fringe areas still hold good potential.
However, the majority of the supply in some locations on the periphery — areas not served by mass transit — is overpriced. Prices have approached the levels seen in the city fringe area where mass transit is available. As a result, we will see the pace of sales slow on the periphery as buyers wait for prices to drop.
Peripherally located condominiums in which many buyers were speculators will suffer when the projects are completed and the units have to be transferred. Developers will be affected by cancellations from both speculators who cannot resell units and buyers who cannot qualify for loans. n
Risinee Sarikaputra is the director of research and consultancy with Knight Frank Thailand. For more information and inquiries, contact email@example.com.
Source: Bangkok Post
- 31 May 2015 at 01:23 267 viewed0 comments
- NEWSPAPER SECTION: SPECTRUM | WRITER: RISINEE SARIKAPUTRA