Thai Property Developers to Focus on Bangkok's Outskirts
The successful completion of a mass transit line is luring property developers to draw their attention on to the borders of Bangkok. In particular, the areas concerned are those around the Purple Line route that stretches between Bang Sue and Bang Yai, The Nation reported. For this, project developers await the new city plan, which will become effective on May 15, 2013. The new plan will prescribe which areas would be available for high-rise residential projects and which are not.
Asian Property Development is one of the developers who have already positioned themselves to tap this market. The company CEO, Anuphong Assavabhokin, noted that in preparation, they are already buying land for their residential projects in the suburbs. In fact, they have already launched both condo units and detached residential properties particularly along Rattanathibet Road, which is located near the Purple Line rail route. Another developer, LPN Development, had seen the need to move to the suburbs. Opas Sripayak, its managing director, stated that LPN had put off buying land in the city proper since December last year because it needs to launch new projects in the suburbs. This is a way they employ to protect the business by initiating new projects along the outskirts of Bangkok until such time that the new city plan is applied.
Nonthaburi, A Favored Suburb Area
One of the increasingly famous destinations for developers is Nonthaburi province. There are over 20 residential projects along Rattanathibet and Ngarmwongwan roads in the Bang Yai district of Nonthaburi. These projects have a combined 10,000 units based on a recent survey conducted by The Nation. It is likewise reported that one-bedroom unit is the most popular among units based on the survey. The number of residential projects in the province reached 181 at the end of 2012. Based on a survey conducted by the Real Estate Information Centre (REIC), these projects had a combined total of 45,822 units. The REIC further estimated that all these available units would take 20 to 30 months to sell if no projects would be launched in the province this year.
The price of a one bedroom condominium unit in Nonthaburi is approximately 1 million Thai Baht. Townhouses are also in high demand with a price that starts from 2.5 million bath or approximately US$84,000. Meanwhile, detached properties start at 5 million baht or roughly $167,500. In the past two years, prices of condos and other types of properties have swelled by 20 to 30 percent. There is indeed a high demand for development in the Nonthaburi area. Because of this, land prices have surged considerably from a mere 30,000 baht per square wah back in 2008 to 100,000 or 200,000 this year. However, even with the huge 50 percent increase in unit prices, these remain lower than in some other parts of Bangkok.
Last year, the LPN Development kicked-off its 1.5-billion baht project – the Lumpini Park in Rattanathibet-Ngarmwongwan development. Aside from LPN, Sansiri was also one of the developers in these areas. In 2012, it had launched the 1.3-billion baht (US$43.5 million) D Condo Rattanathibet, on top of the townhouses and detached residential units it has built in the same location. Also, Supalai came up with 10 condominium development projects in Nonthaburi in 2012. The rest, including Narai Property, Property Perfect and SC Asset have also launched a number of projects within the area in the previous year.
Launching real estate projects in the suburbs offers an opportunity for developers to come up with projects that present more affordable prices than those in other parts of the city. These projects will benefit from an easy and direct access to the city proper as soon as the Purple Line route becomes operational.