Bangkok--27 Oct--Plus Property
Plus Property, a leading Bangkok property agency is seeing a sudden increase in interest from overseas investors, who perceive Thailand’s condominium prices as being among the cheapest with high construction quality in South East Asia.
According to Mr. Anukul Rathpitaksanti, Assistant Managing Director of Plus Property Ltd., enquiries from foreign buyers, mainly from Hong Kong and Singapore, has risen by more than 15 per cent in the past two months and could account for 20 per cent of new condo sales this quarter.
“So far this quarter sales of new and second hand condominiums through Plus Property have topped 50 million baht.
“Most of the Hong Kong and Singapore buyers, who are targeting Bangkok, believe their home markets are overheated and they are worried about moves by their respective governments to curb rising property prices,” he said.
In Hong Kong, where prices have risen 30 per cent in the past year, the government has moved to restrict borrowing for multiple properties by individuals by demanding higher deposited ratios for second and third property investments.
Meanwhile in Singapore, which has seen similar price increases, the government has made it compulsory for developers to charge progress payments in cases where condominiums are sold whilst under construction or new launch projects selling “off the plan”.
Mr. Anukul Rathpitaksanti says that Hong Kong and Singapore buyers, with budgets that would restrict them to the very bottom end of their home markets can come to Bangkok and, for the same money, get into top end condos in the most sort after locations.
“In Hong Kong condominium prices average out at the equivalent of around 400,000 baht a square meter and Singapore is not far behind that figure.
“It’s not surprising that buyers used to these prices see Thailand as a bargain with prices from quality developers averaging out at around 80,000 baht a square meter.
“Even in luxury developments in areas like Ploenchit only average out at around 200 thousand baht a square meter, about half of half Hong Kong’s average price,” he said.
Commenting on the broader market and the regions historically low interest rates, Mr. Anukul Rathpitaksanti said he believes that low interest rates are only part of what is fueling regional markets.
“Currently the Asian region is awash with cash by comparison to the rest of the world, and well situated Bangkok condominiums are seen as a low risk cash generating option, particularly when they can be bought for as little of one third of Hong Kong prices.
“Even predicted rising interest rates are of little concern as our Hong Kong and Singapore buyers tend to pay cash, and those who do borrow are factoring in a 50 per cent hike in interest rates over the next two years,” he said.
Source: leading bank and real estate agent in Hong Kong.