“LWS” reports that the average housing price in Bangkok and its vicinity for 2023 is 5.49 million baht per unit, reflecting a 24% increase from 2022. Meanwhile, the number of new project launches in 2023 has decreased by 4%, but the value of new project launches has increased by 18%.

For 2024, housing prices in Bangkok and surrounding areas are expected to rise by approximately 5-10%, depending on location. This is due to rising costs, including increased land prices in areas near the subway and limited amenities, along with higher construction material costs and financial costs for real estate developers, which are influenced by rising interest rates. These factors are expected to contribute to higher housing prices in 2024.

Mr. Prabhan Sak Raksaiwan, Managing Director of LWS Wisdom and Solutions Co., Ltd., a research and development company in the real estate sector under the LP-N Development Public Company Limited, revealed the report on new housing launches in Bangkok and surrounding areas for 2023, stating that there were a total of 437 new projects launched in the Bangkok and surrounding areas, with a total project value of 544,265 million baht, representing an 11% and 18% increase, respectively, compared to 394 projects and a total project value of 459,374 million baht in 2022. However, the number of units launched in 2023 totaled 99,012 units, a 4% decrease compared to 103,466 units in 2022. The average sales rate on the launch day in 2023 was 17% of the project value, down from 20% in 2022.

The increase in the number and value of new projects in 2023 compared to 2022, while the number of units launched decreased, is attributed to the rise in housing prices per unit in 2023 compared to 2022. Additionally, real estate developers have increasingly launched projects priced at over 10 million baht compared to those priced below 10 million baht, resulting in a higher project value despite the decrease in the number of units launched.

In 2023, there were 96 new condominium projects launched, a 5% increase compared to 91 projects in 2022. However, the number of units launched was 46,464 units, a 10% decrease compared to 51,680 units in 2022, with a total project value of 155,968 million baht, reflecting a 15% increase compared to 135,297 million baht in 2022. The sales rate on the launch day was 26%, down from 29% in the same period of 2022, while the average selling price of residential condominiums in 2023 was 3.36 million baht per unit, an increase of 28.24% from 2.62 million baht in 2022.

Additionally, there were 234 new residential projects priced below 10 million baht, a 6% increase compared to 221 projects in 2022. The number of units launched in 2023 was 43,410 units, a 3% decrease compared to 44,568 units in 2022, with a total project value of 192,264 million baht, reflecting a 7% increase compared to 180,462 million baht in 2022. The average selling price per unit was 7.39 million baht in 2023, an increase of 18% from 6.26 million baht in 2022.

For residential projects priced at 10 million baht and above, there were 116 projects with 9,138 units, valued at 196,033 million baht, representing increases of 33%, 24%, and 36%, respectively, compared to 87 projects with 7,396 units valued at 144,246 million baht in 2022. The average sales rate on the launch day was 11%, down from 18% in the same period of 2022. The average selling price for homes priced over 10 million baht was 21.5 million baht per unit, an increase of 10.25% from 19.5 million baht per unit in 2022. Notably, there are 9 projects that launched homes priced below 10 million baht and above 10 million baht within the same project,” Mr. Prabhan Sak stated.

The large number of project launches in 2023 has resulted in a backlog of residential units in Bangkok and surrounding areas (Inventory) at the end of 2023, with 145,634 units of residential homes, an increase of 12.6% from 129,298 units at the end of 2022. Meanwhile, the number of condominium units in inventory was 84,200 units, a 1.7% decrease compared to 85,675 units at the end of 2022. This backlog indicates that residential homes will take approximately 4-5 years to sell, while condominiums will take about 1-2 years.

In terms of the number and value of property transfers nationwide (Demand), LWS forecasts that the value of property transfers across the country in 2023 will be around 1.06-1.08 trillion baht, remaining stable compared to 2022 or increasing by 1-2% in 2023 compared to 2022. In 2022, the total value of property transfers was 1.06 trillion baht. According to the report from the Real Estate Information Center of the Bank of Thailand, the total number of property transfers in the first nine months of 2023 was 270,650 units, a 4.2% decrease from 282,648 units in the first nine months of 2022. The value of property transfers in the first nine months was 766,791 million baht, an increase of 1.6% from 755,178 million baht in the same period of 2022. The average price for property transfers in the first nine months of 2023 was 2.83 million baht, an increase of 5.99% from 2.67 million baht in the first nine months of 2022.

“The average selling price of residential properties launched in 2023 has increased, along with the average price for property transfers in 2023, indicating that the housing market in 2023 is influenced by rising development costs due to various factors including land prices, construction material costs, and increased financial costs. This trend is expected to continue, with factors such as land prices, construction material costs, financial costs, and rising minimum wages under government policies in 2024 contributing to an average increase of 5-10% in housing prices, especially in Bangkok and surrounding areas where land prices are rising along subway lines and in locations with amenities that meet buyer demand. The limited availability of land in these areas is driving up prices, directly impacting housing prices in 2024,” Mr. Prabhan Sak concluded.