Developers should focus on strategies to reduce risks and drain unsold units priced at 1-3 million baht in the condo market, which faces challenges from weakened purchasing power and stricter lending conditions, threatening market stability.
Nattha Kahapana, managing director at property consultant Knight Frank Thailand, said the condo market is under pressure due to both declining purchasing power and stricter lending criteria from financial institutions.
“Although interest rates have decreased by 0.25%, they remain relatively unchanged overall, and the market is expected to continue its slowdown,” he said.
The condo market in the fourth quarter of 2024 remains subdued, in line with the Bank of Thailand’s (BoT) survey that projected a decline in housing loan demand in the next three months.
In 2025, personal incomes may gradually recover, potentially increasing housing loan demand, but not to normal levels. This reflects continued weak home loan growth and financial institutions’ cautious lending practices based on borrowers’ credit risk.
“The 1 to 3-million-baht condo market will be hit hardest by weaker purchasing power and stricter lending criteria. Developers must address these challenges and find ways to reduce risks in clearing remaining units,” he said.
Meanwhile, new projects are launching at higher prices due to rising land costs, which creates a mismatch with the income levels of potential buyers, making affordability a key issue despite demand.
For projects with unsold inventory, developers may need to adopt sales- boosting strategies, such as flexible payment terms, low-interest rates or down-payment programmes with minimal upfront costs to motivate prospective buyers.
Source: Bangkok Post
