Summary Of August Real Estate Activity In Bangkok

Real estate business associations are opposing a new Bangkok city planning statute aimed at limiting high-rise buildings to roads that have a width of at least 12-16 meters.
The current city planning draft plan (3rd revision) is in the process of opening public hearings but the assessment of the draft comprehensive plan initially found that Bangkok condominiums will be most affected by limiting the construction of a large building or a residential-sized volume of over 10,000 square meters only to streets with a width exceeding 12 - 16 meters. Such a definition would be a starting point of limiting tall buildings in alley, especially in the Sukhumvit area and on Phaholyothin Road which have no roads wider than the draft comprehensive plan.
However, even Bangkok had to clarify that the new road construction would be 12 to 16 meters wide and more totaling 126 routes from 25 routes originally planned.  But the new routes will be cut towards the city’s outskirts which also will face environmental city planning controls that allow only for housing estates with no high rises allowed.
Such requirements make it impossible to build a condominium in more densely populated areas, while lower land price areas are starting to see an increase in value. When the land is not fully utilized, it is not worth the investment to build and middle-income consumers would not be able to live in the city. Most streets now in Bangkok would be unable to host new condominium developments.
The increase in the width of the roads in new city planning requirements is to reduce too many residential buildings in narrow roads because it causes congestion in the street or small alleys. This requirement comes at a time, however, when there a large number of projects both already planned – and approved – and under construction.
However the BMA city plan will define in the draft of comprehensive plan allow to build residential buildings on roads or alleys with a width of 12 to 16 meters and 30 meters from the current set on alleys with a width of 10 meters, 16 meters and 30 meters, but if constructing a road with 10 meters width with an additional 1 m retreat for the future expansion roads.
The higher-end condominium market began to recover in the second half of 2011 due to the increasingly stable political situation now in place. As a result, economic growth and foreigners began to return due to increased confidence in the Thai housing market.  However, many companies have been focused more on middle and lower-end projects forcing fewer high-end projects. If compared with the needs of customers in the upper levels of both Thais and foreigners especially the luxury projects located in the central business district in the Lumpini area including the Wireless Road-Ploenchit area that has huge potential because land prices have risen every year. The current average land price is about 150,000 baht per square meter in the second quarter of 2011 and it is expected that prices will rise again in the near future as long as there are no negative political developments.