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The sales rate for new condos launched in Bangkok in the second quarter fell to 15.7 %, an all-time low, beating the lowest previous quarter (35%) in 2010 when the “red shirt” political crisis brought Bangkok to a standstill.
Risinee Sarikaputra, director of research, said to the Bangkok Post that “The normal quarterly sales rate for new condo launches is around 40-50%,”
According to Knight Frank’s market research, Bangkok hit a decade-long record for new condos entering the market, with 65,000 new units launched throughout 2018, up 11% from 2017, the highest since 2009.
In the first and second quarter this year, new condo supply launched in Bangkok totalled 12,882 units and 14,988 units, respectively.
Knight Frank reported Bangkok had cumulative condo supply from 2010 to the first half of 2019 of 594,453 units with a sales rate of 84%, unchanged from 2017.
525,889 Empty homes in Bangkok
But according Dr.Sopon Pornchokchai, President of research and property valuation center in Thailand, Agency for Real Estate Affairs , there are 525,889 empty homes in Bangkok Metropolitan Region (BMR) which are mostly sold but does not have any residents.
Empty homes (Every type of residential units) are residential units which use less electricity than 15 units per month which indicates that there is almost no use.
These 525,889 empty houses make 10.3% of the 5,097,815 total housing units in BMR, which means that there is 1 empty house in every 10 houses. This ratio was lower than the situation during the Tom Yam Goong crisis, 20 years ago.
In 1995, Dr.Sopon Pornchochai founded 14.5% of empty houses from the total residential units in the market. Then in 1998, the ratio of empty houses reduced to 12.0% of the total residential units in the market.
9.2% of the total low-rise residential units are empty (there is 1 empty unit in every 11 low-rise residential units). While 13.9% of the total condominiums are empty (there is 1 empty unit in every 7 condominium units).
As condominiums are mostly used for an investment purpose while low-rise residential units are mostly used for residential purpose. Investors should invest in condominium carefully during this situation.