New residential supply in Greater Bangkok this year is expected to drop by 10% from a year before to lower than 100,000 units, the lowest level since the severe flooding in 2011, as many developers have been putting off new launches in the fourth quarter to next year.
Samma Kitsin, director-general of the Real Estate Information Center, said this year will be the first year since 2011 that the total number of new residential supply launched in Greater Bangkok is lower than 100,000 units.
"The property market in the final quarter is being softened. We expect launches of many projects to be postponed until next year," he said.
In 2011, the total number of newly launched residential supply dropped by 31% to 82,600 units from 120,200 units in 2010. During 2012-15, the figures rose to higher than 100,000 units per year with 102,600 in 2012, 130,200 in 2013, 118,280 in 2014 and 104,870 units the following year.
During the first nine months of 2016, the number of new residential units launched in Greater Bangkok totalled 70,200 units from 313 projects, down 8.7% from 76,900 units from 318 projects in the same period last year.
Of the amount, 37,200 units were condos, a 17% decline from 44,900 units, while 33,000 units were low-rise houses, a slight increase of 3%.
"Many large developers had planned to launch a lot of new projects, particularly condos in the fourth quarter after they held off new launches in the first four months to focus on ready-to-transfer units to boost sales during the period of property tax incentives which ended in April," he said.
"Due to unfavourable sentiment, however, many of them are likely to postpone their launches to next year."
According to Mr Samma, this year the number of new low-rise houses launched will total 42,000-43,000 units against the usual 45,000 for the segment. Condo launches will be between 50,000 and 52,000 units, the lowest since 2011.
Prasert Taedullayasatit, president of the Thai Condominium Association, disclosed a few weeks ago that the value of new residential supply by large listed developers planned for the fourth quarter alone was estimated at 150 billion baht.
Surachet Kongcheep, associate director of research at property consultant Colliers International Thailand, said the number of new condo supply launched in Bangkok in the third quarter was the highest in the past four quarters as the economy showed signs of improvement.
"The key factor that boosted sentiment in the third quarter was government spending. It will also play a major role in stimulating sentiment in the fourth quarter and next year," he said.
As of the end of the third quarter, Bangkok's condo take-up rate remained solid at 75%.
The highest rate was for units price 100,001-150,000 baht per square metre with a take-up rate of 82%, followed by lower than 50,000 baht per sq m and 150,001-200,000 baht per sq m with 81% each.