Thailand’s housing market again is strengthening.

Thailand’s housing market again is strengthening, with the economy more powerful and rates of interest low.

The average price of single-detached houses rose by 6.3% (5% in real conditions) through the time to Q2 2018, a clear turnaround from previous year’s 3.1% year-on-year decline, based on the  Bank of Thailand (BoT). Through the latest quarter, house prices increased just a little by 0.1% (-0.6% in real terms) in Q2 2018.

Condo prices rose by 4.9% (3.6% in real terms) during the year to Q2 2018, from a 3 up. 9% year-on-year growth during Q2 2017. Quarter-on-quarter However, condo prices slipped 1.7% (-2.4% in real conditions) through the latest quarter.

Townhouse prices rose by 6.8% (5.5% in real terms) through the year to Q2 2018, a sharp improvement from carrying on year’s 0.7% growth. During the latest quarter, townhouse prices increased by 2.5% (1.8% in real conditions) in Q2 2018.

Land prices strongly are climbing. The land price index increased by 7.92% (6.58% in real terms) year-on-year in Q2 2018, in sharp contrast with the 5.5% gross annual decline in Q2 2017. Quarter-on-quarter, land prices increased just a bit by 0.85% (0.2%) in Q2 2018.

Residential construction activity is surging. Nationwide condo registrations rose sharply by 69% to 53,186 items in the first half 2018 from yearly prior, according to the BoT. Condo registrations were actually about 30% higher in the first half of 2018 as compared to the last 1 / 2 of 2017.

Demand is robust. Nationwide land and building trades increased by 5.1% to THB 539.64 billion (US$16.56 billion) in the first 1/2 of 2018 compared to the same period this past year, based on the BoT. All areas, except the Northern region, observed transactions rise over time.

CBRE expects the housing marketplace to continue to grow stronger. “The outlook for the end-user personal market shall be brighter in 2018,” said CBRE. “Lenders have eased criteria on home loans, which should raise the buyer’s ability to access mortgage finance.”

Thailand´s economy grew by 4.6% in Q2 2018 from a year earlier, from year-on-year growth of 4.9% in Q1 2018 and 4% in Q4 2017, based on the National Economic and Social Development Board. The Bank of Thailand lately elevated its 2018 economic growth forecast for the fifth time for you to 4.4% from its previous projection of 4.1% a consequence of growing exports and strong private intake.

No property bubble

Property prices have risen very in Thailand before several years modestly, partly because of the country’s prolonged political uncertainty. From 2008 to 2016, house prices rose by 29 just.1% (10% in real conditions). In 2017, house prices rose modestly by 4% (3.2% in real conditions) from yearly earlier.

Real demand, not speculative demand, exists for low-rise housing below THB 3 million (USD $92,078), which accounts for 70% of the marketplace, in respect to Housing Business Association (HBA) president Issara Boonyong. The remaining 30% of the demand originates from buyers, who buy homes to create rental income.