Market index sees strong quarterly growth
Residential maintains upward trajectory
The residential property market index in the first quarter maintained an upward trend as it saw quarter-on-quarter growth of 10.4% to 86.8, almost matching the pre-pandemic level due to a strong recovery in demand and supply.
"Residential demand in the first quarter saw a significant growth with a higher absorption rate of both condos and low-rise houses," said Vichai Viratkapan, acting director-general of the Real Estate Information Center (REIC).
In the first quarter of 2022, the absorption rates per month of condos and low-rise houses were 7.6% and 3.1%, respectively, up from 3.3% and 2.4% in the second half last year.
Last week, SET-listed developer AP Thailand Plc reported year-on-year growth of 43% in presales of residential units in the first half of 2022 to 25.5 billion baht which was also a new record high in 38 years since its establishment.
Compared with the first half last year, AP's presales from condo units almost tripled and those of low-rise houses rose 25%.
At the same time, Sansiri Plc had a growth of 30% in presales from low-rise houses to 10 billion baht in the first five months, almost achieving 40% of the 2022 target at 24 billion baht in presales of low-rise houses.
"The residential property market index which grew by 15.4% in the first quarter this year, compared with the same period last year, was in line with the country's economic growth of 2.2% in the period," said Mr Vichai.
The rise of the residential property market index was seen in the fourth quarter last year as it jumped to 78.6 from 68.0 in the third quarter -- the lowest index in almost a decade since the great floods in the fourth quarter of 2011.
The index of 86.8 in the first quarter was also higher than that in the first quarter of 2020, which was the beginning of the pandemic during which the index plunged to 80.6, down from 88.0 in the fourth quarter of 2019.
Throughout the pandemic period, the index was below 80.6 until the first quarter this year which was also higher than an earlier prediction at 78.6.
REIC used data from residential market surveys, the number of units getting land allocation permits, the number of units getting construction permits, the number of newly registered units and the number of newly transferred units to do the index.
"Both soaring housing sales and the larger number of new residential supply launches were key drivers of the rise in the index in the first quarter," Mr Vichai added.
"They also reflected a higher confidence of both homebuyers and developers."
In the first quarter of 2022, housing developers' sentiment index on new project launches picked up to 45.1 from 40.2 in the same period last year, according to REIC.
The number of residential supply newly launched in Greater Bangkok in the first quarter soared 208% to 29,594 units worth a combined 107 billion baht, driven by condos (18,844 units) which grew by 378%.
That of low-rise houses rose 89% to 10,750 units.
AP alone launched 20 new residential projects worth a total 21.3 billion baht in the first half and plans to launch 40 more worth a combined 53.62 billion baht in the second half.
Mr Vichai said the residential property market index in the second half would be higher due to property incentives with the cut of transfer and mortgage fees and the easing of the loan-to-value limit.