Asian buyers drive luxury condo sales
Strong demand for luxury condominiums in the central business district (CBD) has returned from both foreign and local buyers, most of whom buy them as an investment to park their wealth.
Aliwassa Pathnadabutr, managing director of the property consultant CB Richard Ellis (Thailand) or CBRE, said buyers from Hong Kong, Singapore, China, South Korea and Japan have replaced Europeans as the main buyers over the past four years.
"The Chinese have wanted to buy Bangkok luxury condos for a long time and seen good signs in the country's political situation since last year," she said.
In the first quarter, the consultant recorded strong sales of Bangkok luxury condo units at a Hong Kong roadshow.
Most buyers were wealthy Chinese who wanted a condo for long weekends while turning their money into an asset.
In recent years, foreigners accounted for only 10% of buyers of luxury Bangkok condos, but that proportion has doubled, driven mainly by Asian buyers.
Despite the stronger baht, property prices in Bangkok remain relatively lower than at other destinations.
Ms Aliwassa said luxury condos in prime locations offer an alternative investment amid stock market fluctuations, US-dollar depreciation, plunging global gold prices, soaring inflation and low interest rates for deposits.
In the medium and long term, luxury condos offer a profit of 4-6% from rentals, while their value rises by 5-7% a year on average.
"Land plots for new development are very scarce in the CBD, causing resale prices of condos to soar due to the limited number of new ones," said Ms Aliwassa.
Luxury condo units priced from 150,000 to 200,000 baht a square metre launched last year numbered 1,633, down from 2,359 in 2011.
CBRE expects no more than 1,500 units to be launched this year.
The CBRE Elite Living 2013 event is being held at Siam Paragon until May 6 to introduce 1,000 luxury condo units worth a combined 15 billion baht from 15 projects in the CBD and riverside as well as key tourist destinations.
It targets achieving 3 billion baht in sales.