2011,Overview,Bangkok,Property business, insurance 2011 Overview Of Bangkok's Property Situation


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There are a number of mixed signals coming from the Bangkok property market at the current time but the general prognosis is good and if the current political stability holds for the foreseeable future then the investment climate will continue to improve.Some of the mixed signals include increased demand and rising prices for residential development property in the central business district and a predicted drop in property values in the city and its suburbs this year. The demand has been centered on Wireless, Ploenchit, Sukhumvit, Rama I, Rajdamri and Sathorn roads, areas in the heart of the city.And regardless of the overall situation, developers are moving ahead with over 200 condominium projects alone this year and the extensions of the Mass Rapid Transit underground train and the Bangkok Transit System Skytrain are providing new prime areas for expansion in the inner city. Significant amounts of land have already been acquired by developers in these areas and more acquisitions are expected. Developers focused also on the less developed areas in the centre of town, including Rama IV Road, Phetchaburi Road and Si Phaya Road.Although property prices are expected to drop this year, mid- and long-term prospects still continue to look good as this expected drop is considered to be as a result of several factors that hit all at once and created a great impact.First, the central bank tightened up its loan requirements for condo buyers by limiting banks to providing only 90% of the value of the property for loans. Second, tax incentives that were in place until last year were ended by the government. Then, there are slightly higher interest rates and higher construction costs to contend with which raise the prices for prospective buyers. New condominium units accounted for 54% of residential sales last year but that is expected to drop to 50% this year because prices on resale units are expected to drop up to 10%, making them more attractive to buyers.However, the Government Housing Bank is attempting to make it easier for non-salaried people to purchase property, something that has not been possible up until now. If this happens then the lower end of the condominium market could be positively impacted which would affect the percentage of condo sales.And other property companies are rolling out projects, with Sansiri unveiling a Bt1.7 billion condominium project on Ekamai Road and Vichitra Group launching two projects in the east of Bangkok, outside of the central business district and near the BTS Skytrain line.Sansiri schedules the grand opening for "Cell" project for March 5-6, when the project is available at Bt2.6 million per unit. Vichitra Group plans to launch two new residential projects worth totally Bt791 million. Branded "Maroy", the projects are along the Motorway and On Nuj-Bangna road. Offered at Bt1.9-Bt3.5 per unit, they feature detached houses, townhouses, and commercial buildings, said the company's chairman Suebwong Wukamongkol said.All of these factors have painted a picture of the real estate market that is currently not clear but the next few months should provide a much better idea of how the market will end up in 2011.

2011,Overview,Bangkok,Property

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