Following the official implementation of the LTV measures on April 1, 2019, it was found that the supply of newly launched condominiums in Bangkok decreased by over 10,399 units, representing a 33.4% drop from the previously hot supply during the same period last year. In Q3/2019, developers continued to delay the launch of new condominium projects, with only 24 projects totaling 11,059 units and a development value of approximately 46.66 billion baht. Major developers listed on the stock exchange accounted for about 66.4% or approximately 7,342 units, while medium and small developers contributed around 3,717 units or 33.6%.

Although the new supply increased from the previous quarter by about 1,424 units or approximately 14.78%, it still represented a 51% decrease compared to Q3/2018. Many developers adjusted their project development plans for this year, postponing the launch of some projects while focusing on selling off existing stock, particularly completed units that remain unsold, which is a significant concern for developers at present.

Regarding the sales rate of newly launched condominiums in Q3, it was observed that although there was a 5% increase from the previous quarter, it decreased by 19% compared to the same period last year. Major developers listed on the stock exchange continued to drive the market, with an average sales rate of approximately 45% or about 4,978 units. Over 68% of sales came from major developers, and some new projects managed to sell quickly in Q3 due to prices being relatively lower than market rates and focusing on unique project designs that cater to the lifestyle of the new generation, resulting in significant interest from buyers, with queues forming for over 5 hours before the project opened for sale. However, developers still promoted older completed projects with special discounts to clear remaining stock, which continues to be a major concern for them.

For the final quarter of the year, it is anticipated that there will be an additional 15,000 units entering the market, as these are projects that were postponed from earlier launches, and developers need to launch them within this year to avoid impacting their development plans for the following year.

New Condominium Supply from Q1 2015 to Q3 2019 by Quarter

 

          Approximately 11,059 units were newly launched in Q3 2019, a decrease of 51% compared to Q3 2018, but an increase of about 1,424 units or approximately 14.78% from the previous quarter. The increase in newly launched condominiums in the last quarter was due to all developers wanting to sell and conduct marketing activities in Q3 instead of waiting for the final quarter of the year, which could affect overall project development plans. However, many developers adjusted their plans for launching condominium projects this year down from what was initially planned at the beginning of the year, after delaying launches in the first half of the previous year as most developers focused on clearing existing stock, particularly completed units. Most condominiums launched in Q3 were large projects with over 1,000 units located in areas along the construction routes of the new subway lines, especially the Orange Line around Rama 9 and Ramkhamhaeng. It was noted that major developers listed on the stock exchange have developed many condominium projects in this area, and several other developers are studying project models for future development in these locations.

New Condominium Supply by Area (Units)

 

Approximately 61% or 6,477 units of the newly launched supply in Q3 2019 were located in the outer areas of Bangkok. It was found that only 158 units were launched in the inner city areas (Sathorn, Silom, Sukhumvit). The outer western areas (Krung Thonburi - Kalapapruek) also saw significant interest from developers for new projects, particularly around the BTS Talat Phlu station, where both major developers and new entrants are keen to develop condominium projects, with over 5,000 units currently under development and set to launch in the future.

Several condominium projects that had previously sold out during pre-sales faced issues when construction was completed and the buildings were registered, with 15-20% of units falling through due to buyers abandoning their deposits or banks not approving loans, forcing these buyers to return their units to the project for resale. This has become another concern for many developers.

The remaining unsold supply in the market stands at approximately 55,000 units, which has become a significant concern for all developers, as they need to expand every quarter. They cannot delay the launch of new projects while rushing to sell off remaining units. Therefore, developers must create differentiation in their projects regarding design, project type, unit layout, and amenities to attract buyers. Additionally, developers are seeking ways to sell to foreign buyers and investors before opening sales to Thai buyers, even though many condominiums launched in recent months have higher prices than the average prices of other projects in the same area.

Average Sales Rate of Newly Launched Condominiums by Quarter

 

New condominium projects launched by developers listed on the stock exchange in Q3 had a significantly higher sales rate than medium and small developers, with 68% or approximately 3,383 units sold out of a total sales rate of about 4,978 units attributed to major developers. Approximately 22% or 1,595 units were from medium and small developers, reflecting the effective marketing strategies and promotional activities that reached a wider customer base. Additionally, some major developers held VVIP sales rounds for investors or VIP customers at special prices before the official launch, leading to some projects closing sales or achieving high sales rates just days after the official opening. Major and reputable developers continue to seek new purchasing power amid a slowdown in Thai consumer purchasing power, particularly from foreign buyers in Asia. Many developers have opened new projects abroad and collaborated with foreign brokerage firms to sell their foreign quotas continuously, even though the demand from foreign buyers has started to slow down recently.

Average Sales Rate of Newly Launched Condominiums by Price Level

In Q3 2019, newly launched condominiums in Bangkok had an average sales rate of approximately 45% from 11,059 units, an increase of about 5% from the previous quarter but a decrease of 19% from the same period last year. In the past quarter, some condominium projects from major developers listed on the stock exchange managed to sell and close sales quickly due to prices being relatively lower than market rates and focusing on unique project designs that cater to the lifestyle of the new generation, resulting in significant interest from buyers, with queues forming for over 5 hours before the project opened for sale. However, it was also noted that developers continued to promote older completed projects with special discounts to clear remaining stock, which remains a significant concern for them.

New condominiums launched in the lower price range of 100,000 – 200,000 baht per square meter had the highest average sales rate of approximately 47% of all units sold in Q3 2019. Following that, condominiums in the price range below 100,000 baht per square meter had an average sales rate of about 40%, reflecting that the market in the mid to mid-high price range along the subway routes remains attractive to buyers, even though many projects have been developed in this price range recently.

Average Selling Prices of Newly Launched Condominiums by Quarter

The average selling price of newly launched condominiums in Q3 2019 was approximately 126,530 baht per square meter, a decrease of about 14.7% from the previous quarter. This is because approximately 61% of the projects launched in Q3 were located in the outer areas of Bangkok, and over 40% or about 4,509 units launched in the past quarter were priced between 50,000 – 100,000 baht per square meter. Most of the condominiums launched were large projects with over 1,000 units located in outer areas along the construction routes of the subway, particularly the Orange Line around Rama 9 and Ramkhamhaeng, with only one project located in the inner city (Sathorn, Silom, Sukhumvit), resulting in the average selling prices of newly launched condominiums in Q3 2019 decreasing from the previous quarter.

New Condominiums Launched in Q3 2019 by Average Price

In Q3 2019, over 47% or approximately 5,241 units were priced between 100,000 – 150,000 baht per square meter, and it was found that over 430 units from newly launched condominium projects in the past quarter had selling prices exceeding 250,000 baht per square meter, with some projects in the Phloen Chit area having average selling prices exceeding 457,000 baht per square meter, which received significant interest from buyers.

New condominium projects near BTS stations are already priced above 250,000 baht per square meter and are expected to continue increasing every quarter, maintaining an upward trend throughout 2019 and into the future. This is due to the current high land prices in inner Bangkok and limited land availability, resulting in higher development costs for developers, which in turn reflects in the selling prices that need to be adjusted upwards for newly launched condominiums. However, it is currently observed that completed condominiums ready for occupancy in Bangkok and second-hand condominiums still available in the market are priced lower than new projects in the same locations, providing buyers with more options and making them perceive better value in purchasing second-hand condominiums compared to newly launched ones with higher selling prices and smaller unit sizes.

Foreign buyers are a new target market for developers listed on the stock exchange and reputable developers in Thailand, especially for projects located along Sukhumvit and Ratchadapisek roads in the central business district. Although many developers have successfully sold units in projects along the construction routes of the subway to foreign buyers, it is evident from the sales of newly launched condominiums in Q3 2019 that many projects continue to attract interest from foreign customers.

New Condominiums Launched Along the Subway Construction Routes

          The Blue Line is the subway route where the most condominiums have been developed over the past six years, with over 37,197 units, accounting for 25.7%. Following the trial operation that began in August from Hua Lamphong to Bang Sue, the official opening is expected in 2020 for the Blue Line along Charan Sanitwong Road. It is noted that many major developers are preparing plans to develop new condominium projects along the Blue Line this year, despite the significant remaining supply in the market along this route. According to the research department of Colliers International Thailand, the condominium market along the Orange Line (especially around Rama 9, Ramkhamhaeng, and Lamsali) and the Yellow and Pink Lines are expected to be highly watched this year, with many condominium projects anticipated to be developed in the future.