Bangkok housing prices dip to new low
Offering prices for residential units in Greater Bangkok during the third quarter of 2021 fell to the lowest level since the fourth quarter of 2016 because of the ailing economy, according to property website DDproperty.com.
Country manager Kamolpat Swaengkit said 2021 was a challenging and volatile year for the property market as Covid-19 affected all business sectors, suppliers, developers, the labour market and homebuyers.
"Consumers wanted to buy a house, but the fragile economy and high household debt had a strong impact on their liquidity. Many of them had to delay home purchases," said Ms Kamolpat.
According to its survey on the Bangkok property market in the third quarter, the housing price index saw consecutive quarterly dips since the fourth quarter of 2020 from 197 to 190, 183 and 178 in the first three quarters of 2021.
The third-quarter index marked a drop of 11% from the same period last year.
However, by category, the price index of low-rise houses, particularly single detached houses, rose 6% year-on-year, up 13% from the third quarter of 2019.
On the contrary, the price index of condos saw consecutive declines with a drop of 11% from the third quarter last year and a decline of 16% from that recorded prior to the pandemic.
She said the property market in 2022 may improve with the economic recovery and better control of the Covid-19 situation, with government measures as the key driver.
"The loan-to-value limit was eased in October, but it cannot boost the property market as consumers are uneasy about the pandemic and cannot afford to buy a home."
In terms of consumer sentiment, 71% of consumers still want to buy a house but have kept delaying the purchase. About 39% planned to buy within 1-2 years.
The main reason (66%) was an income shortage, followed by housing prices (63%).
Other reasons include political uncertainties and banks' rejection of mortgage loan applications at 37% each.
Some 80% of respondents said government aid was insufficient to help them buy a residential unit.
The most wanted measure was a reduction in home loan interest for both new homes and existing houses they are repaying.
Ms Kamolpat said the housing trend had changed with rising demand for low-rise houses in Bangkok's outskirts because they were feasible locations at more affordable prices.
The key driver was the expansion of mass transit lines to the outlying areas.
"Locations where housing prices tend to grow were in the city's outskirts as low-rise houses at affordable prices for the mass market were developed in those areas," said Ms Kamolpat.