New Condos Outperform Low-Rise Houses in Price Growth
Residential property prices in urban areas and along mass transit lines continued to trend upward in the fourth quarter of 2024, driven by soaring land and construction costs. The Real Estate Information Center (REIC) revealed that the prices of newly launched low-rise houses and condos in Greater Bangkok experienced year-on-year increases.
The price index for new low-rise houses rose by 0.8% to 131.4, marking nine consecutive quarters of growth. In contrast, the condo price index climbed by 3.6% to reach 159.9, gaining for the eighth consecutive quarter.
The primary factors influencing these price increases included rising land prices, construction material costs, and labor expenses, as reported by the REIC.
Notably, the condo price index significantly surpasses that of low-rise houses due to the higher land costs associated with condo developments, typically situated along mass transit lines or in prime locations.
In Bangkok, condo prices rose by 3.4%, although this was lower than the increases seen in Samut Prakan and Nonthaburi, which recorded a year-on-year gain of 4.2%.
The most substantial rise in condo prices in Bangkok occurred in the Huai Khwang-Chatuchak-Din Daeng area, particularly within the 3.01-5 million baht price range.
For Samut Prakan and Nonthaburi, the highest price increases were in the Mueang Samut Prakan-Phra Pradaeng-Phra Samut Chedi area, falling within the 2.01-3 million baht segment.
The price index for low-rise houses in Bangkok increased by 2.3%, exceeding the performance of neighboring provinces Nonthaburi, Pathum Thani, and Samut Prakan, where the index saw a 1% decline due to price adjustments for townhouses.
Year-on-year, the price index for single detached houses rose by 2.1%, while townhouses recorded a modest 0.3% increase. The Min Buri-Nong Chok-Lat Krabang area in Bangkok witnessed the highest price surge for single detached houses, particularly in the over 10 million baht price range.
In Nonthaburi, Pathum Thani, and Samut Prakan, the Lam Luk Ka-Khlong Luang-Thanyaburi area in Pathum Thani saw the most significant price increase within the 7.51-10 million baht range.
Bangkok’s Phra Khanong, Bang Na, Suan Luang, and Prawet areas experienced the highest increases for townhouses, particularly within the 5.01-7.5 million baht price bracket.
The REIC identified the most effective sales strategy in both markets as offering cash discounts, available in 25.2% of condo transactions and 29.6% of low-rise house sales.
In the fourth quarter of 2024, the housing construction cost index increased by 4% year-on-year to 139.9, indicating a consistent rise, with labor costs also climbing by 4%. Prices for sanitary ware surged by 12%, while tiles, electrical and plumbing equipment, wood, and wood products witnessed growth rates of 5.6%, 3.7%, and 2.2%, respectively, largely attributed to escalating oil and energy prices globally.
Looking ahead, the REIC anticipates that the introduction of low-interest loans by financial institutions could stimulate the housing market in early 2025.
