Condo sales up as supply slows in Nonthaburi

Published: 01 Jun 2017 | WRITER: Kanana Katharangsiporn

[Bangkok Post] The sales rate of condominiums in Nonthaburi has improved as the number of new projects launched in the past six months has slowed down, according to property experts.

Wanna Chaisuphathanakun, executive director of SET-listed developer Everland Plc, said developers themselves have adjusted their development plans for condo projects by slowing new launches in Nonthaburi, where condo supply has been substantial in recent years.

"There were a handful of new condo projects launched in the past six months. As a result, the average sales rate of condos, which totalled 45,000 units in Nonthaburi, improved to 70%," she said.

According to the Real Estate Information Center (REIC), Muang district in Nonthaburi had the highest condo supply and unsold condo units compared with other districts in Greater Bangkok as of the second half of 2016.

However, the condo absorption rate in Nonthaburi last year improved to 3.6% per month from 2.5% in 2015.

REIC's acting director-general Vichai Viratkapan said that if there is no new condo supply launched in Nonthaburi, the existing supply will take 22 months to be sold off, second only to Bangkok and Samut Prakan, where it will take eight and 20 months, respectively.

Ms Wanna said Nonthaburi has high potential as it is the second largest housing market following only by Bangkok.

Everland is developing a condo project worth 6 billion baht, The Politan Rive, in Sanambinnam area and recorded 5 billion baht in presales. About 47% of customers are from Bangkok, 37% in Nonthaburi and 16% from other provinces.

The area will have new infrastructure projects like the Sanambinnam Bridge, a new bridge across the Chao Phraya River, with new roads linking it to Tiwanon and Ratchaphruek roads and a motorway from Bang Yai to Dawei.

"Developers, when choosing a location for a residential projects, should not consider only mass transit lines but also other infrastructure projects," Ms Wanna added.

Pathum Thani will also see changes in infrastructure, which will create a windfall to Nonthaburi's border areas close to Pathum Thani as high-rise buildings are be unlikely to be allowed in Pathum Thani, she said.

Key successes at some condo projects included unit prices of up to 80,000 baht per square metre, better functions and facilities, said Ms Wanna, who is a former executive vice-president of Pruksa Real Estate Co.

Saenphin Sukhee, managing director for residential development at SET-listed Golden Land Property Development Plc, said the housing sector is struggling as there are several challenges like rising land costs, high household debt and the bank's rejection rate.

"The environment has changed," he said, "In the past, developers preferred a large-scale site for the single house and townhouse development. Today projects should be scaled down as customer segmentation creates a variety of target markets."

He said land supply for single house and townhouse development was limited to an average increase of more than 30% per year in price.

To cope with rising costs, developers should take affordability into consideration.

REIC reported there was a total of 442,716 residential units in Greater Bangkok from 1,549 projects where sales were active, as of the second half last year.

Of this amount, 238,887 units worth 760 billion baht were condos, with 58,967 units worth 211 billion baht remaining unsold, compared with 220,500 total units with 59,900 unsold units worth 182 billion baht remaining in 2015.