Real Estate Information Center, Government Housing Bank (REIC) has reported the overall housing market situation in five northern provinces, including Chiang Mai, Chiang Rai, Lamphun, Phitsanulok, and Nakhon Sawan. The report indicates that the housing market for sale in these five northern provinces in the first half of 2022 saw an increase in total supply, including the number of projects, units, and value compared to the same period in 2021 (YoY). New supply has increased in terms of both the number of projects and units, particularly in Chiang Mai, which is a key province in the north, showing the highest growth rate in both the number of units and the value of new projects.

Dr. Vichai Wiratkhapan, Inspector of the Government Housing Bank and Acting Director of the Real Estate Information Center revealed that the survey of housing projects in the five northern provinces during the first half of 2022 found a total of 19,789 units valued at 76,182 million baht. This includes 2,656 condominium units valued at 7,552 million baht and 17,133 housing development units valued at 68,629 million baht. There were 3,000 new units entering the market valued at 12,644 million baht, with 2,950 units sold valued at 10,537 million baht, resulting in 16,839 unsold units valued at 65,645 million baht.

 

The direction of the housing market recovery in the north is expected to expand mainly in key areas such as Chiang Mai, with growth in both new launches and sales. The absorption rate remains stable, and it is noteworthy that the absorption rate for condominium projects is still better than in the other four provinces in the same area. The absorption rate remains low despite no new projects being launched. The recovery is primarily seen in housing development projects, and developers are increasingly developing twin houses as land prices rise, making twin houses a more acceptable option for homebuyers. Although the overall market is still progressing, the second half of the year is a critical period to watch due to negative factors affecting both construction costs and purchasing power.

Supply in the first half of 2022 saw an increase in housing units offered for sale compared to the first half of 2021, with both the number of units and value increasing. The number of units increased by 12.01%, and the value increased by 16.47% compared to the total units offered in the first half of 2021. The number of units offered increased with 3,000 new projects entering the market valued at 12,644 million baht, with the number of units increasing by 245.22% and the value increasing by 414.57%. This includes only 772 condominium units valued at 2,446 million baht and 2,228 housing development units valued at 10,198 million baht.

Overall, it can be seen that new condominium projects launched in the first half of 2022 are primarily located in two areas: downtown Chiang Mai and the Payap University area, while housing development projects are spread across various locations such as Mae Rim, San Pa Tong, and the Bo Sang-Doi Saket area.

The top 5 locations with the most projects offered for sale in the north are:

1. Mae Jo area: 1,855 units valued at 5,156 million baht

2. San Sai area: 1,671 units valued at 5,708 million baht

3. Saraphi area: 1,670 units valued at 6,142 million baht

4. Airport-Mae Fah Luang area: 1,439 units valued at 5,099 million baht

5. Bo Sang-Doi Saket area: 1,306 units valued at 5,679 million baht

Regarding the situation of unsold units in the north as of the first half of 2022, there are 16,839 units, an increase of 7.2% from the first half of 2021, valued at 65,645 million baht, an increase of 12.6% . This includes 1,768 condominium units valued at 4,938 million baht, with the top three locations having the most unsold condominiums being: 1. Downtown Chiang Mai: 432 units valued at 1,562 million baht, 2. San Sai area: 362 units valued at 964 million baht, 3. Upper Hang Dong area: 286 units valued at 894 million baht.

For housing development projects, there are a total of 15,071 unsold units valued at 60,707 million baht, with the top three areas being: 1. Mae Jo area: 1,684 units valued at 4,685 million baht, 2. Airport-Mae Fah Luang area: 1,320 units valued at 4,867 million baht, 3. Saraphi area: 1,289 units valued at 4,941 million baht. It can be observed that the majority of unsold units are single-family homes.

Demand shows that in the first half of 2022, there were 2,950 new housing sales valued at 10,537 million baht, divided into only 888 condominium units valued at 2,614 million baht. The top three areas with the highest new condominium sales are: 1. Downtown Chiang Mai: 455 units valued at 1,557 million baht, 2. San Sai area: 140 units valued at 387 million baht, 3. Upper Hang Dong area: 107 units valued at 270 million baht.

Meanwhile, new sales of housing development projects totaled 2,062 units valued at 7,923 million baht, with the top three areas having the highest sales being: 1. Saraphi area: 211 units valued at 723 million baht, 2. San Sai area: 198 units valued at 724 million baht, 3. Mae Jo area: 171 units valued at 471 million baht.

The survey found that there were 772 new residential condominium projects launched in Chiang Mai, valued at 2,446 million baht, while housing developments are spread across all five provinces, with Chiang Mai having the most sales at 1,698 units valued at 8,372 million baht.

However, when considering the absorption rates by type of housing, it was found that in the first half of 2022, the overall absorption rate across all types was 2.5%, with the best absorption rate found in single-family homes at 2.3%, while the absorption rate for condominiums was at 5.6%.

The top 5 locations with the highest absorption rates for condominium projects

1. Railway side area: 9.2% absorption rate

2. Downtown Chiang Mai: 8.5% absorption rate

3. Downtown Phitsanulok: 5.0% absorption rate

4. Sawan Witthaya area: 4.9% absorption rate

5. San Sai area: 4.6% absorption rate

In 2022, the overall northern region

For 2022, the Real Estate Information Center estimates the overall housing market in the north, predicting that there will be 4,793 new projects launched, an increase of 68.4% compared to 2021, which had 2,847 units. The value of new launches is estimated at 14,490 million baht, an increase of 46.4% compared to the previous year, which had a value of 9,897 million baht. The number of new sales units is expected to be 5,183 units, an increase of 9.9% compared to 2021, which had 4,718 units, while the value of new sales is expected to be 17,037 million baht, a decrease of 1.7% compared to the previous year, which had a value of 17,334 million baht.

  The number of unsold units is expected to be 17,242 units, an increase of 13.1% compared to 2021, which had 15,243 units, with a total value of unsold units at 60,317 million baht, an increase of 5.8% from 56,996 million baht. Meanwhile, the absorption rate in the horizontal project category has decreased to 1.9%, while the absorption rate for condominiums is expected to increase from 2.7% in 2021 to 3.0% in 2022.

When considering by area, the Real Estate Information Center predicts that in 2022, Chiang Mai will have 2,869 new housing units entering the market, an increase of 96.5%, valued at 8,670 million baht, an increase of 63.2% compared to 2021. The number of new sales units is expected to be 3,895 units, valued at 12,968 million baht, with an increase of 31.9% in units and 13.4% in value compared to 2021. The number of unsold units is expected to be 10,835 units, valued at 41,908 million baht, with an increase of 23.5% in units and 17.7% in value compared to 2021.

Chiang Rai is expected to have 1,013 new housing units entering the market, valued at 3,412 million baht, with an increase of 197.9% in units and 237.5% in value compared to 2021. The number of new sales units is expected to be 630 units, valued at 2,181 million baht, with a decrease of 5.3% in units and 17.9% in value compared to 2021. The number of unsold units is expected to be 2,413 units, valued at 9,762 million baht, with an increase of 1.2% in units and 5.3% in value compared to 2021.

Phitsanulok is expected to have 488 new housing units entering the market, valued at 1,362 million baht, with a decrease of 32.9% in units and 50.0% in value compared to 2021. The number of new sales units is expected to be 389 units, valued at 1,166 million baht, with a decrease of 49.9% in units and 51.8% in value compared to 2021. The number of unsold units is expected to be 3,158 units, valued at 9,168 million baht, with an increase of 11.3% in units and 2.9% in value compared to 2021.