Property boom continues in regions

Despite the continuing political upheaval, Thailand's property market is expected to eke out growth, especially in locations associated with flourishing border trade, says Plus Property. 

"Border trade, especially after Asean Economic Community integration in late 2015, will be more vital and could pave the way for Thai developers who seek to expand their businesses," said managing director Poomipak Julmanichoti.

"It helps enhance the competitiveness of Thai products in neighbouring countries’ markets, as Thailand has the geographical advantage of being connected to these countries."

Over the years, border trade between Thailand and the neighbouring countries has risen steadily, with the value between Thailand and four countries — Myanmar, Laos, Cambodia and Malaysia — amounting to 924 billion baht in 2013, up from 910 billion in 2012.

The growth was partly attributable to more free trade and economic promotion adopted in these countries as well as Thailand's focus on industrial zone development.

According to Plus Property, flourishing border trade has also created investment in property development for commercial and residential purposes.

Most of Thailand's 89 border trade spots have a reasonable population, workers, investors and even tourists generating income and economic expansion.

A study by Plus Property’s research and development department, conducted from 2013-14, found that the property markets in border trade areas had experienced strong expansion, particularly in the condominium sector.

The condo market has benefited from indirect factors such as income generation from retail businesses in economic zones as well as more acceptance of the concept of urban living and living in compact condos to save expenses.

The survey found that Chiang Rai, Phitsanulok, Udon Thani and Hat Yai – all situated in border trade zones – had rapidly growing condo markets and most projects were launched last year.

On average, 20 condo units per project were sold each month. However, up to 40-50 units were sold at condo projects developed by big property players.

The survey found that most buyers were locals, such as parents of school and university students, state officials and investors who sought monthly rental income.

This explained the increasing demand for condos, though the new projects had eaten into the market share of rentals of older apartments in the areas.

Not every border trade zone has experienced growth in its condo market, probably because the geography in some provinces is more suitable for horizontal living rather than vertical living.

Many buyers still chose detached houses and townhouses ahead of condos, especially in Ubon Ratchathani and Kanchanaburi provinces.

Source: Bangkok Post