Thailand’s property market is under increasing pressure from rising land and construction costs, which are pushing up the price of new homes, including houses and condominiums. The most significant price increases for new homes were recorded in the districts of Minburi, Nong Chok and Lat Krabang, while Huai Kwang, Chatuchak and Din Daeng led the way for condominiums.
The overall price index for new homes in Bangkok and its environs continues to rise, reaching 131.4, indicating steady price increases. The price increases are attributed to the rising cost of land, materials and labour, particularly in areas with high demand and good public transport.
Interestingly, condominium prices in Samut Prakan and Nonthaburi provinces are outpacing those in Bangkok, indicating changing supply and demand dynamics in the region. Developers, in turn, are actively using marketing promotions, including cash discounts, to stimulate buyer demand in the face of rising prices. While Bangkok posted a 2.3% increase, surrounding provinces such as Nonthaburi, Pathum Thani and Samut Prakan saw a 1% decline, mainly due to cheaper townhouses. In Bangkok itself, detached homes have seen a larger increase than townhouses, with developers offering significant discounts on apartment complexes, which may indicate an attempt to stimulate demand.
Geographically, detached homes in Minburi, Nong Choek and Lat Krabang in Bangkok, as well as Lam Luk Ka, Klong Luang and Thanyaburi in neighboring provinces, saw the most significant price increases. In the townhouse segment, Phra Khanong, Bangna, Suan Luang and Prawet in Bangkok led the way, along with Bang Kruai, Bang Yai, Bang Bua Thong and Sai Noi in surrounding provinces. One of the key factors influencing the market is the continued rise in construction costs.
The HCCI index shows a 4% year-on-year increase, driven by rising prices for building materials and labor. The price hikes for plumbing fixtures, tiles, electrical equipment, and wood materials are particularly notable, due to the global rise in oil and energy prices. Higher labor costs also add pressure on the final cost of real estate. All these factors put upward pressure on new home prices, while consumer purchasing power is weakening due to the slowdown in economic growth. In this regard, low-interest home loan programs from government financial institutions are expected to provide some support to the market in early 2025.
