Despite a sluggish market, some developers are still launching new projects in central Bangkok.
Photography by Jan Yong
The start of 2016 has been sluggish for Bangkok’s property sector, and this is despite the government’s attempt to stimulate the property sector through a series of short-term measures such as cuts in the fees for housing transfer and mortgage. Interestingly, Bangkok developers who were on a building spree a few financial quarters ago have retrenched their staff, choosing to concentrate on shifting their current stock as opposed to launching new projects.
Bangkok’s top developers have adapted to the different environment through changes in their operating strategies with perhaps Pruksa Real Estate Development PCL making the most surprising operational shift, announcing that they will restructure by setting up a “holding company” to facilitate expansion into new businesses. Pruksa has not given specifics on the “new businesses” they are planning to expand into, however analysts speculate that this is an attempt to diversify their operations to reduce its exposure to property sector related risks.
This brief overview might give investors the feeling that it’s all doom and gloom; however it is important to note that Bangkok is comprised of a variety of areas and properties at different market-levels which are each performing differently. While condos at the lower-end of the market are experiencing a general pinch, it is important to note that units in the prime areas are still relatively active.