OFFSETTING the current slow residential sales in Bangkok is the healthy resale market which is performing quite well with pockets of strong activity, Robert Collins, CEO of Savills Thailand said recently.
Although it is called the second-hand market here, this is actually a natural resale market for owner-occupiers or investors looking to sell or rent out units particularly in areas where there are clusters of expatriates be they French, British, Japanese or Americans.
“The good, well-managed buildings in those locations continue to perform really well, values go up.
“Saladaeng Road is a conduit road between Sathorn and Silom and always continues to do well.
“Irrespective of whatever the market cycle is, the good buildings are full. Irrespective of the high profile new launches, Saladaeng just prospers great.
“And Sukhumvit has multiple clusters, very similar the Yen Akart area of Sathorn is again another fantastic cluster.
“I am not saying they are recession proof but they bridge these market cycles really well.”
Mr Collins added that any slowdown in the volume of new launches would be beneficial for the marketplace because arguably many of the new launches are very hard to differentiate from other buildings in the same lane that are also relatively recent launches.
“Bangkok needs to take have a period of absorption, to sell some of the new supply, see an increase in owner-occupiers or tenants before any successive waves of hundreds of units type of developments come on line.”
However at the very premium end of the market, particularly the branded residential sector, there is a lot less product available than people think.
“Products like Four Seasons Residences and Mandarin Oriental Residences – there is good international demand for them.
“It’s not flying out the door but it’s consistent, they do get high values and they put a halo effect on the Bangkok property marketplace.
“Any new branded residential announcements coming to this market will be received very well.”
Even so Mr Collins admitted that there has been a gradual decline in foreign buying here which is simply mirroring the international trend because while people continue to buy in London, Sydney and New York, these are in fact major capital cities with intense pressure on housing and these purchases come under safe haven investment category.
Foreigners who do buy property in Thailand do so for a different purpose with this typically being to use the property as their private residence or that they have a strong connection with this country and want to invest real estate here.
“But Bangkok is a very well established marketplace, very popular, incredibly popular tourist destination, not just regional it’s globally too, that’s going to remain for sure.
“It’s a very resilient marketplace especially compared to other countries. Bangkok is possibly the most resilient property market in the world.”
TOP: Hotels, condominiums and other buildings on both banks of the Chao Phraya River. Photo: Prachanart Viriyaraks, CC-By-2.0
INSET: Mr Collins says the very premium end of the market is doing well.
By Nina Suebsukcharoen