Pattaya is bouncing back

PropertyGuru

20 October 2014 at 12:01 pm

The Pattaya condominium market is predicted to perform better in the second half of the year following the stable political situation and the establishment of a new government that may have boosted the confidence of foreign tourists and benefited the Pattaya condominium market.

Colliers International, in its Pattaya Condominium Market 1H 2014 research report, noted that buyers had started site visits and were making buying decisions during June 2014. This was after many countries warned their citizens to avoid travel to Thailand during the last quarter of 2013 and during the first few months of 2014. The governing NCPO has still not cancelled Martial Law, the agency noted, and this it said affected the confidence of foreign tourists. All of these situations are also directly affecting the condominium market in Pattaya.

Local Thai and foreign developers, as well as big names from Bangkok, are trying to attract more buyers through marketing campaigns offering perks, such as a guaranteed yields in between one and three years. These schemes have been successful in attracting buyers.

The total existing condominium supply in Pattaya City is roughly 55,950 units, approximately 40 percent of which is located in the Jomtien area. This represents the highest concentration in Pattaya City.

Approximately 3,800 units were launched in the first six months of 2014, representing a 60 percent decline over the previous six month period. The average take-up rate of the condominium market at the end of 1H 2014 was approximately 73 percent, slightly higher than that of the previous six months.

A shortage of labour is still a major obstacle for the construction industry in Thailand. Many residential projects cannot be completed by the expected date. In addition, some projects cannot achieve their sales targets, which may affect their construction progress.

The average selling prices of new condominiums launched during 1H 2014 was approximately THB62,000 per sqm, according to the real estate firm, and that remained similar to prices noted in the second half of 2013.

The average price in the Jomtien area was the lowest, at around THB48,500 per sqm as there are many large condominium projects with average prices of approximately THB1.5 million per unit. and starting prices lower than THB1 million. Mid-range to low-end condominium projects are successful with the Thai and foreign buyer groups, although most of them are far from the beach. Their primary selling point is facilities, such as a themed resort style with large swimming pool.

Many high-end and luxury condominium projects were launched in Wongamat area, so the average price in the area was higher than in other locations by between 8 percent and 23 percent. The average price in the Pratumnak area as in 1H 2014 increased from 2H 2013 a little more than 2 percent due to limited available land in the area.

Beachfront projects commanded the highest average price at more than THB120,000 per
sqm, and this figure continues to increase every year due to limited beachfront land in the Pattaya City area.

Many new condominium projects were launched in Na Jomtien in the past one to two years. Most are located in beachfront areas, and all of the projects target the high-end and luxury market.

Some water park projects are under construction and are expected to be completed between 2014 and 2016. When all of the projects have been completed, many Thai and foreign tourists will be attracted, and Colliers predicts the property market in Pattaya city should grow further in popularity.

A super selection of properties from across Thailand will be on show in Singapore on Saturday, November 1, and Sunday, November 2, at the PropertyGuru Thailand Property Show.

Andrew Batt, International Group Editor ofPropertyGuru Group, wrote this story. To contact him about this or other stories emailandrew@propertyguru.com.sg