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Phuket's condominium supply to grow in Kata and Karon
During 2011, the Kata and Karon Beach areas of Phuket, Thailand, emerged as top locations for new condominium developments.
Nattha Kahapana, director of Knight Frank Phuket, revealed that last year, these two regions accounted for 59 per cent of the new supply in the condominium market.
He noted one of the main reasons for the rising number of new projects in Kata is the affordability of land in the district, compared to the most desirable area along Patong Beach.
Mr Kahapana added there is very little free space on this sought-after strip of land, which adds to the appeal of less-developed regions like Karon Beach and Kata.
A report published by CB Richard Ellis (CBRE) Thailand last year revealed there was an increase in the number of new condominium projects launched in Phuket during the third quarter of 2011.
However, the firm noted affordability is one of the key issues driving buyers in the marketplace, with demand strongest for Phuket properties in the under ten million Thai baht (£204,656) price bracket.
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Housing developers 'showing more caution' in Thailand
Developers in the Thai real estate industry are exhibiting a greater degree of caution in their investments, it has been claimed.
A report published by CB Richard Ellis (CBRE) Thailand noted that a slowdown in demand from speculators has largely driven the change.
In Bangkok, firms that are purchasing land for construction projects are focusing on the area around the route of the new purple line railway system, the organisation revealed.
The track, which is currently under construction, is scheduled to open in 2014 and will provide train services between Bang Phai Canal and Tao Pun.
Meanwhile, developers are rushing to apply for building permission at many sites across Thailand, CBRE found, because proposed alterations to town planning regulations may make it more difficult for projects to get the go ahead.
One of the main changes being suggested under the new rules is a further restriction on the size of building that can be constructed on narrow roads, the firm highlighted.
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Warnings sounded about property bubble in Thailand
Concerns surrounding the creation of a property bubble in Thailand have been raised by the country's Agency for Real Estate Affairs (AREA), Property Report has revealed.
AREA has warned that, if created, the bubble may burst if the planned numbers of launched units are completed in a few years time.
Indeed, the news provider explains that a total of 107,508 units spanning 398 developments may be underway by the end of the year, compared to just 57,604 units from 283 developments in 2009.
And AREA president Dr Sopon Pornchokchai warned that there was a genuine risk of the bubble bursting if the market continues to grow at the same pace as this year through to 2012-13.
"It will lead to an oversupply in the market. Resale prices and rents will also drop accordingly," he told the news provider.
"This would cause troubles to financial institutions that currently extend high-percentage mortgage loans, also to shareholders of those financial institutions, and last but not least to the overall Thai economy."
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