Value of property launches rises by 59%

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Value of property launches rises by 59%  
Bangkok Post: 18 Jan 2011

New property launches in 2010 were valued at 299 billion baht, up 59% from 2009, the highest total in its 16 years of keeping track, according to independent real estate consultant Agency for Real Estate Affairs.

The agency predicted a similar value for real estate projects launched this year. It also warned investors, developers, and buyers to be aware a price bubble may burst in 2012.

Sophon Pornchokchai, the company's president, said there were 429 real estate projects launched in Greater Bangkok in 2010, up 50% year-on-year. There were 115,748 units launched during the period, up 98%.

He believes the upsurge surpasses demand, creating the risk of a bubble.

Residential property was valued at 291.743 billion baht from 424 projects or 114,150 units, of which 54.7% were condominiums, followed by townhouses (26.8%), single houses (14.4%), twin houses (3.2%), and commercial buildings (0.8%).

Other types of real estate projects represented only 7.293 billion baht.

The average price per unit was 2.556 million baht, significantly lower than 3.177 million baht in 2009.

The agency said the lower price was due to developers offering price incentives to attract more buyers.

Some 58% of residential property cost less than 2 million baht per unit, with 41% priced at between 1-2 million baht per unit.

In another development, Century 21 Realty Affiliates (Thailand) Co said it completed a study that shows the Bang Na-Trat-Chon Buri area will become a prime location in the near future due to rapid commercial and industrial growth over recent years.

The main road serving Suvarnabhumi International Airport and the BTS skytrain is scheduled to be extended this year, said Kitisak Jampathipphong, Century 21 Thailand's CEO.

"Recently, Chinese investors indicated they are planning to invest more than 10 billion baht in the Bang Na-Trat area due to its prime location," he said.

http://www.bangkokpost.com/business/economics/216911/value-of-property-launches-rises-by-59