Price index hits high in final quarter
The price index soared for new single detached houses in Samut Prakan, Nonthaburi and Pathum Thani in the fourth quarter last year, hitting an all-time high after land prices in the three provinces increased in the previous quarter.
According to the Real Estate Information Center (REIC), the price index of new single detached houses available for sale in the three provinces rose by 7.6% to 134.6 in the fourth quarter of 2022 from 125.1 in the same period of 2021.
The index grew by 5.3% from 127.8 in the third quarter of 2022, while in Bangkok it tallied 123.6, a decrease of 0.6% year-on-year and a drop of 2.2% quarter-on-quarter.
The overall index for the four provinces rose 2.8% quarter-on-quarter and 4.9% year-on-year.
The REIC reported in November last year the zones with the largest year-on-year increases in land prices in the third quarter of 2022 were in the provinces of Samut Prakan, Nonthaburi and Pathum Thani.
They comprised Samut Prakan's Bang Phli, Bang Bo and Bang Sao Thong districts, with a jump of 55.7%, followed by Nonthaburi's Muang and Pak Kret districts, with growth of 42.8%.
Next in line were Pathum Thani's Muang, Lat Lum Kaeo and Sam Khok districts, with a rise of 28.1%.
Vichai Viratkapan, acting director-general of the REIC, said the price index for new low-rise houses, which includes single detached houses and townhouses for sale in Greater Bangkok in the fourth quarter of 2022, rose for the first time in three quarters.
"The index rose 2.4% from the third quarter after slight quarterly declines of 0.01% and 0.1% in the second and third quarters, and an uptick of 0.4% in the first quarter," he said.
A year-on-year increase of 2.7% in the price index of low-rise houses in the fourth quarter last year was the first increase since the first quarter of 2021. From the first quarter of 2021 to the third quarter last year, the index posted consecutive decreases, the first such downtrend since the index was initiated in 2012.
"A key driver in the higher price index for low-rise houses was the launch of many new projects in the period, and costs during that period were more expensive," Mr Vichai said.
In the fourth quarter last year, all construction materials except for tiles recorded a surge in price, pushing developers to raise their property prices.
Another factor that was attributed for 40% of the higher prices was a majority of campaigns offered to buyers of low-rise houses during the period took the form of a waiver of expenses on the transfer date.
The second most popular campaign, with 36% taking part, was free giveaways such as air conditioners, water pumps, electricity and water meters, gardening items and the laying of grass. Cash discounts dropped to 23% of campaigns from 36%.
In the fourth quarter of 2022, the price index of new condos for sale in Greater Bangkok fell 0.6% year-on-year and 1.9% quarter-on-quarter as developers shifted their focus to low-rise house sales. The majority of campaigns offered to condo buyers were waivers of expenses on the transfer date, said the REIC.
"The drop in the condo price index was likely caused by cash discount campaigns as developers wanted to accelerate sales and transfers before the easing of the loan-to-value limit expired on Dec 31, 2022," said Mr Vichai.