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However, those who own units in cheaper buildings should sell them fast, as the prices could fall 10-15 per cent after the valuation is released at the end of this month.

Condominium prices in the central business district will definitely rise following the release of the valuations, said property experts.

Luxury condos in the CBD area are now priced between Bt80,000 and Bt100,000 per square metre on average. The Sukhothai Residence charges Bt330,000 per square metre for its penthouses.

Klayo Thongsom, director of the Treasury Department’s Property Valuation Bureau, said yesterday at a seminar on where the best locations would be after new valuations are announced that the valuations would reflect market prices.

Aside from condominium prices, the bureau - which is now in charge of property price indicators, formerly the task of the Lands Department - also plans to come up with annual valuations for land in Bangkok and nationwide.

According to Klayo, the new valuations, to be effective next January, will first lead to an increase of 10-15 per cent in land prices in five districts in Bangkok - Don Muang, Min Buri, Bang Kapi, Lat Phrao and Bueng Kum - and in 50 provinces.

"We know our new valuations announced on January 1 this year are up to 20 per cent lower than market prices because they were based on data collected in 2006 and mid-2007," he said.

In the latest valuation, the bureau raised property prices nationwide by 26.9 per cent on average.

In Bangkok the increases averaged 5.76 per cent, and elsewhere the average increase was 27.14 per cent.

However, market prices continue to be higher than the new valuations announced on January 1.

Property Perfect’s senior executive vice president Teerachon Manomaipibul has even said that the new valuations do not effect market prices and continue to be lower than market prices. However, the new valuations will increase the tax on land transactions for buyers.

The tax will rise by up to 27 per cent this year compared with last year, assuming that transaction activity is close to that of last year, Klayo said.

The Lands Department announced income from land transaction tax and land transaction fees of Bt50 billion in the last fiscal year (October 2006-September 2007), down 0.89 per cent from the previous 12 months.

The department also announced transaction tax and transaction fees of Bt9.04 billion in the first two months of this fiscal year, up 7.3 per cent year on year.

(Soure: The Nation)

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