Despite a notable surge of 30% in visitor numbers at the recent House & Condo Show, held last month, the residential property market in Greater Bangkok during the first quarter of 2024 has remained tepid, primarily due to subdued purchasing power.
Tritecha Tangmatitham, the managing director of SET-listed developer Supalai, highlighted that market sentiment in the first quarter mirrored trends from the latter half of the previous year. He pointed out that the mortgage rejection rate has persisted, indicating ongoing challenges in the market. Tritecha attributed the lackluster demand to weak purchasing power among consumers, citing concerns about the economy’s trajectory and escalating debt levels as contributing factors.
Despite an initial optimistic outlook post-pandemic, consumers have grown wary over time, realizing that economic conditions have not improved as anticipated. Factors such as delayed government spending and slower-than-expected progress on infrastructure projects, including key mass transit lines like the Orange Line, have further dampened market sentiment. Additionally, elevated interest rates have deterred potential buyers, as many await more favorable borrowing conditions.
For developers, the first quarter posed significant challenges, particularly in the lower-end residential segment, where consumers face heightened financial constraints. However, the middle- to upper-end market segments have shown more resilience, reflecting varying degrees of consumer confidence across income brackets.
Supalai reported housing sales of 250 million baht during the House & Condo Show, marking a 25% increase from the previous year’s March edition. While the expo’s total sales reached 4.5 billion baht, up from 4 billion at the previous edition, Tritecha cautioned against interpreting the surge in visitor numbers as a sign of positive sentiment, citing relatively low walk-in traffic at project sites.
Another prominent developer at the expo, Sansiri, reported substantial sales of 800 million baht during the event, signaling continued investor interest despite the market’s challenges.