Property players face challenges
|Property players face challenges|
|BANGKOK POST Issued date 15 September 2011|
| KANANA KATHARANGSIPORN|
Higher construction costs, zoning rules
Despite the bright business outlook driven by strong confidence in the economy among consumers in the second half, property developers are still concerned that the unclear housing policy of the government and rising costs will affect the sector significantly.
Therdsak Thaveeteeratham, a senior vice-president with Asia Plus Securities,said the market in the latter half would be active as listed developers launch a number of new projects.
But he added the sector was still constrained by some negative factors that could affect sales.
His remark was supported by statistics from the Real Estate Information Center (REIC) that reported new house registrations in the first seven months declined by 14% year-on-year to around 46,300 units while transferred units numbered 88,200 units, a 23% drop year-on-year.
From January to August,58,350 units were launched from 243 projects.
"In the first half of the year, the number of new launches was similar to last year, but the last couple months declined," said Samma Kitsin, the REIC director-general.
In greater Bangkok, new launches of low-rise units were 30,600 units,down 12% year-on-year, while condo launches were at 27,800 units, down 15% year-on-year.
Mr Samma said the property market faces higher construction costs, rising inflation and an unclear housing policy from the new government, especially regarding city planning.
At a forum yesterday, the Thai Con-dominium Association (TCA) asked the Office of Natural Resources and Environmental Policy and Planning to clarify regulations and processing times for considering environmental impact assessment (EIA) reports, and to share the growing approval workload with other government agencies.
The Lands Department was also asked to amend sale-and-purchase agreements to allow sales activities even if construction permits are still pending,because this shortens the period to sell projects.
New city planning rules concern some developers as they limit new construction of a high-rise building with a height of over 23 metres in locations where a soi is smaller than 12 metres in width.
Phanom Kanchanathiemthao, managing director of the property consultant Knight Frank Chartered (Thailand),said the Hua Hin market would heat up after a sluggish first eight months as at least four listed developers are scheduled to launch projects later this year.
Property prices have tended to be stable or decrease slightly as foreign demand dropped.
Patima Jeerapaet, managing director of the property services group Colliers International Thailand, said the Bangkok hotel market in the second quarter of 2011 picked up year-on-year from a sharp drop in the second quarter last year.
The average occupancy rate of luxury hotels in Bangkok in the second quarter of 2011 was around 70%, slightly down from the first quarter of around 75%but up from 30% in the second quarter of 2010 during the riots.
In the first eight months of the year,foreign tourist arrivals totalled 13 million compared with 15.93 million for all of 2010.
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