|
Low-priced projects might be delayed
Property developers should be careful of higher construction costs and new
property-related laws as they diversify their portfolios, industry executives
said.
Issara Boonyoung, managing director of the residential developer Kanda Property
Co, said higher construction costs would likely affect low-priced condominium
projects. Those with prices of 30,000 baht per square metre might not be built
as costs have climbed to as high as 20,000 baht.
''Despite the good sales, some developers of low-priced units might not be able
start construction due to higher costs,'' he said.
Meanwhile, high-end condominium developers would not face this situation as they
have higher margins.
Another issue developers might face is escrow accounts, which might be effective
within a year after being talked about for two decades. All developers would
need more money to invest for developing projects, but homebuyers would have
more confidence in buying a unit as their down-payments would not be used for
developers' cash flow. Environmental issues are also a concern.
''Actually, an environmental impact assessment (EIA) is not a new issue but new
regulations on green areas have delayed many projects. There should be clear
regulations announced to developers,'' he said.
Prasert Taedullayasatit, chief business officer of the listed developer Preuksa
Real Estate Plc, said the EIA board, at its latest meeting in January, discussed
whether to cancel the new regulations on green area. This would be good news for
condominium developers whose projects are waiting for EIA approval.
''Last year every condominium developer enjoyed selling units, but they might
face difficulties caused by increasing prices of steel. They should try to
reduce and control costs,'' he said.
The Real Estate Information Center (REIC) yesterday reported a survey on
residential supply in Greater Bangkok. It found that more than 231,164
outstanding units from 1,157 projects were available for sale at the end of the
third quarter of 2007.
Of the total projects, 951 were low-rise and 403 were located in Bangkok,
followed by 152 in Nonthaburi, 149 in Pathum Thani, 128 in Samut Prakan, 64 in
Samut Sakhon and 55 in Nakhon Pathom.
The total number of low-rise units was 153,648. There were 53,655 units in
Bangkok, followed by 35,967 in Pathum Thani, 26,492 in Samut Prakan, 20,906 in
Nonthaburi, 11,251 in Samut Sakhon and 5,377 in Nakhon Pathom.
In the third quarter of 2007, 9,402 units were sold and 62,911 remained up for
sale, 25% of which were pre-built units. At the same time, 206 condominium
projects were sold in the quarter.
Meanwhile, 77,516 condominium units were available for sale at the end of the
third quarter. About 44% were priced at 1-2.99 million baht a unit.
Of this number, the largest were in Bangkok with 62,880 units, followed by Samut
Prakan with 12,754 units, Nonthaburi with 1,638 units and Pathum Thani with 244
units.
Source: Bangkok Post
|
- - - - - - -