Bangkok – July 12, 2022
Frasers Property Home (Thailand), Thailand's residential business leader, pointed out the impact of major economic crises that the entire world is currently facing, a result from the Covid-19 pandemic and the prolonged conflict between Russia and Ukraine, which precipitated difficulties on many fronts, whether the rise in energy and oil prices or the shortage of resources, all of which raised the production costs and costs of living. This is reflected by the inflation and the raise of interest rates announced the Federal Reserve (FED), resulting in higher construction costs, which led to higher home prices and living costs.
Mr. Saenphin Sukhee, Chief Executive Officer, Frasers Property Home (Thailand), stated that “For the real estate sector to sustain revenue, there are four key factors which are employees, operating systems, maintenance, and after-sales service. On top of that, the environment is also something that needs to be taken into account in order to achieve sustainability and continuity of revenue for this industry.”
Mr. Saenphin further commented on the direction of Thai real estate that, regarding the project development trends, consumer demands for low-rise property will be more intense. The sale volume of detached houses will be growing steadily, especially for those of at least 10 million baht. With the growing trend of land price on an annual basis, low-rise housing became one of the most attractive products to invest in.
For the real estate sector, it still needs to adjust so that the business can return to its original "RESILIENCE" stage, whether in terms of location, price, or products as consumer behaviors have changed after the crisis.
During 2022, Frasers Property Home (Thailand) has launched 25 projects worth 29,500 million baht, comprising 10 townhome projects, 2 Neo Home (semi-detached house) projects, 10 detached house and 3 upcountry projects. It expanded target groups to penetrate the middle-upper market that has high purchasing power as well as developing projects that resonate with consumer needs, whether in part of house design, main entrance, park, or distinctive environment to attract customers of all segments, usable space for all activities, while also being completed with amenities such as a private swimming pool, Frasers Clean&Cool Air technology to enhance ventilation, and EV Charger to suit the needs of consumers who are environmentally conscious.
“For the direction of Thailand’s real estate market, in addition to the fiercer competition of the low-rise housing, which has drawn attention of most real estate developers who wished to attract customers with higher purchasing power, we will also witness a change in the business model employed by those developers, as they are now focusing on the areas outside Bangkok and perimeter, and decided to locate new housing projects upcountry to expand the market even more. This is due to the rise in land prices within Bangkok and perimeter and the high market competition. Moreover, the developers have also adjusted their development model by erecting projects on small plots of lands to generate revenues more rapidly. In the end, if the economy finally improves, working groups with regular income will return to the market faster.” Mr. Saenphin Sukhee concluded.
