Large developers are controlling just about every aspect of the Thai condo market, especially in Bangkok.
In news that will probably be no surprise to anyone, the President of the Thai Condominium Association, Prasert Taedullayasatit, says that large developers controlled the market in the first half of 2016 and are likely to do so in the second half of the year as well. The larger developers play in every market segment, from those with unit prices lower than 50,000 baht per square metre to over 250,000 baht.
Prasert believes that growing debt in Thailand’s burgeoning middle class is starting to have an edict. ”Some of them (Condo Developers) will undergo business restructuring in the next six months as the sluggish economy affected the lower-end segment where high household debt was a major problem,” he said.
According to the Thai Condominium Association, over 50% of the new townhouse and condo launches in the first half were by large developers. They also launched nearly two-thirds in the single-house segment.
Peerapong Jaroon-ek, chief executive of SET-listed Origin Property, suggests that developers should have a clear business model and find a niche market where there is still residual demand. “Each location, station or even soi has a different demand. Developers should find it and offer the right product, price and segment to meet their requirements,” he said. “Developers should also monitor the market and adjust sales and marketing strategies to keep up with the situation.” He added that good after-sales service was another strategy condo developers should adopt or improve as it helps brand building and makes customers happy.
Apa Ataboonwongse, president of SET-listed Richy Place 2002, says the market in the second half of 2016 would improve as the economy picks up after many negative factors passed. He sees the only challenge would be the Government’s constitutional referendum.
Sources: Bangkok Post, Thai Condominium Association