Khao Yai’s holiday home market has become more active during the high season, with several major condominium and villa development projects actively running promotional campaigns to boost sales. While the campaigns are driving the interest, buyers’ decisions continue to depend a lot on the quality of products that each of these projects offers, according to property consultancy JLL.
Khao Yai saw a big real estate boom between late 2000s and early 2010s when a lot of new condominium and villa projects were launched in response to the fast-growing interest from middle-class and wealthy Thais looking to have a holiday or retirement home near Bangkok.
However, actual demand has been lower than interest, and thus failed to keep pace with the fast growth of supply. As a result, the market has seen a marked slowdown in both construction and marketing activity since 2014.
Most of the resort condominium and villa projects that have been active in Khao Yai are those that have recently been re-launched or opened new phases. Among them are Swan Lake (around 150 condo units), Bela de Monte ( 50 villas), Zen Next ( 70 condo units) and Akas (100 condo units and eight villas).
Prices of condominiums and villas in Khao Yai vary greatly from 5 million baht to 35 million baht for a condo unit and 15 million or more than 100 million baht for a villa. However, JLL found condominiums priced between 12-15 million baht are selling at the fastest rate while villas priced 20-40 million baht have seen the strongest demand.
Bunthoon Damrongrak, head of residential developments at JLL, says: “Prices of the best-selling residential units in Khao Yai are generally higher than the average for major holiday home markets across Thailand. This implies that the majority of buyers in the hill resort market have exceptionally high purchasing power.”
“As there is some correlation between pricing and quality, the prices of the best sellers also reflect buyers’ willingness to pay more for premium products,” says Mr Bunthoon.
“Sales performance at Swan Lake is a prime example explaining the case well,” says Mr Bunthoon. “It has been Khao Yai’s most successful condominium project in 2017 in terms of sales. The project has enjoyed a strong sales rate at 80%. While prices of units start from 9 million baht, most of the sold units are those costing 12-15 million baht,” he continues.
In fact, one of the major challenges that buyers have experienced in a number of holiday home markets in Thailand is the scarcity of quality supply. Khao Yai is no exception.
“Khao Yai is a niche market dominated by affluent middle-aged Thai buyers who purchase units for own use and put a great emphasis on quality of products. That said, future condominium or villa development projects in Khao Yai are likely to be in the prime segment where demand concentrates,” says Mr Bunthoon.
However, while buyers in Khao Yai generally have high purchasing power, they are small in numbers. In order to best capture the demand in this niche, developers planning new projects must make sure they truly understand what prospective buyers are looking for,” Mr Bunthoon concludes.