Condominium demand in Hua Hin and Cha-am continues to soar, outpacing growth seen elsewhere in the country, says consultancy Plus Property Co.
A train approaches Hua Hin railway station, which is surrounded by a growing, bustling city. Analysts expect demand for residential buildings in Hua Hin and Cha-am will remain strong. KRIT PROMSAKA NA SAKOLNAKORN
Managing director Poomipak Julmanichoti forecasts first-quarter condo sales figures in the neighbouring districts will show healthy growth following a string of new development announcements last month.
These include L.P.N. Development Plc's new project in Cha-am, which has already reached a high take-up rate of 70%.
Meanwhile, Plus Property set a new record with 600 million baht in sales of completed Hua Hin/Cha-am condo units from Sansiri Plc in the two-day "Joy of Hua Hin in Bangkok" event held recently at Siam Paragon.
"These sales figures indicate especially high demand growth in the Cha-am and Hua Hin condominium market compared with other regions even as major cities nationwide continue to face an oversupply," Mr Poomipak said.
"This leads us to a couple of key questions. Will upcountry condominium markets enter a bubble state? When is the right time for consumers to buy or invest in condominiums in this situation?"
Data from late last year show the Bangkok condo market had an absorption rate of 71% and an occupancy rate of 81%, both of which signify consistently high demand for both residential and investment purposes.
However, the Hua Hin/Cha-am area is one of the few zones able to beat Bangkok's absorption rate, with a 73% ratio from the sale of 29 seaside (east side of Phetkasem Road) projects, offering a supply of 14,100 units against demand of 10,400.
This area evidently still has residential property demand to be fulfilled, Mr Poomipak said. With a peaceful atmosphere, easy access and some of the best beaches and seaside scenery along the Gulf of Thailand, Hua Hin is a highly desirable location for families looking for a good vacation spot or weekend getaway.
Investors in Hua Hin property look to lease out units, especially during peak rental periods in the winter. European tenants dominate the leasing market, with the top three nationalities being Russian (29%), Swedish (11%) and Finnish (10%), while the average rental period is between one and three months.
Hua Hin is considered one of Thailand's top five tourist destinations thanks to the development of three water parks, three floating markets, sheep farms, cultural attractions such as Plearnwan, large shopping centres, golf courses and sports complexes.
The cabinet is considering a proposal to construct a high-speed railway link between Bangkok and Hua Hin, a project that would deliver a massive boost to the city and its property market.
"We expect the property market in Cha-am and Hua Hin to soar even higher for residents and investors alike in the summer school break, especially in April and May thanks to the abundance of holidays for Chakri Day, Songkran, Labour Day and Coronation Day," Mr Poomipak said.
"This summer is a golden period for anyone looking to purchase or invest in finished condominium units, as they will have the time to check out the actual units, which also minimises the risk inherent in purchasing under-construction projects. The market here offers an average price of 70,000 to 80,000 baht a square metre.
"The recent drop in the policy interest rate will help to simplify housing loan applications and reduce the financial burden placed on the borrower."