Thailand's construction sector continues to ramp up activity

Despite the economic uncertainty in the country, developers are planning to launch several new projects in Bangkok in the second half of 2016.

In the first half of 2016, despite economic difficulties and increased household debt, the Thai property market demonstrated growth, reports the DD Property portal, citing a Knight Frank study.

At the moment, developers are placing their main hopes on migrants. Since they either look for housing to buy themselves, fueling demand, or limit themselves to renting. The latter makes the purchase of apartments with a view to subsequent renting out a profitable investment, which also has a positive effect on sales.

Developers are also interested in increasing demand for real estate purchases from local residents. Therefore, today they are focused on building real estate that meets the needs of the middle class, whose monthly income is €1,300-2,600. It is this category of citizens who have the highest purchasing power. Thais with lower incomes are more often denied mortgages. Developers expect that due to the reorientation in the second half of the year, demand, and subsequently housing prices in Bangkok, will go up.

The Knight Frank study also notes that the majority of new housing supply is in suburban areas – about 75% of the total. Since the level of development in the center of Bangkok is very high, and the cost of land for construction here is much higher than in the suburbs.