Offices, Condominiums and Apartments – How Have Things Changed In The Past 10 Years In Bangkok?

Hi. I’ve been working as a real estate agent in Bangkok since 2006. In that time I have seen some changes, but surprisingly very little has changed. Let me explain.

Apartment Rental Prices Bangkok 2008 – 2018

Rental prices of most apartment buildings have increased very marginally over the past 10 years. Whereas a spacious 3 bedroom apartment in Sukhumvit area would have cost 70,000 Baht 10 years ago, it may cost you 85,000 Baht today. That’s only a 20% increase over 10 years, actually far less than inflation, and in many ways an apartment is cheaper now than 10 years ago.

Why? It’s difficult to say but I would guess that ongoing political problems, 2 coups, and a pretty stagnant economy barely kicking over at around 3% growth in GDP each year are the reasons. This level of growth may be acceptable for a world leading developed nation, but for Thailand that (let’s face it) still has some way to go in terms of development, it’s not very good.

The apartment rental market in Bangkok is mostly governed by expats. Thai people don’t rent at these prices, either they don’t earn enough, or are sensible enough to buy a property in the suburbs, or are part of the immensely wealthy elite and already own several blocks in central Bangkok. As the number of expats has remained fairly constant, so have rental prices.

Newly built condominium buildings have seen a rise in rental prices, and there will always be a small percentage of people who have sufficient budget and only want to live somewhere very new, something is particularly true of Japanese renters, but the new buildings will become old and once they have been constructed and a rental price has been established, you will notice that the price will stay relatively stagnant from then on.

This is actually the same with condominiums for sale. Once a building has finished construction, a sales price and rental price is established, and it will remain stagnant at this level for years to come.

But prices have been increasing in Bangkok, everyone knows that!! So am I wrong?

Condominium Sales Prices Bangkok 2008 – 2018

I don’t think I’m wrong. There are some condominium buildings that have experienced a very good level of capital appreciation in recent years, but “on average” they haven’t.

Yes, prices have been increasing significantly in Bangkok, and this is something that all developers will happily promote to you when selling you their brand new project. They will show you graphs with an upward trend in prices, and show you that prices are increasing at least 5-10% year on year.

Prices of brand new buildings have been increasing a 5-10% year on year, but not completed buildings.

This is mostly down to increases in land prices. As land prices increase (and to some extent construction costs) so have the cost of new buildings. So new buildings get ever more expensive, but are completed buildings following suit?

No. And this is why I’m not wrong. A building that cost 150,000 Baht/sq.m. 5 years ago, may now only be 160,000 Baht sq.m. In this example around 1.5% compound growth. This building was brand new 5 years ago, and a brand new building today still under construction might cost you 200,000 Baht/sq.m. which is 33% more than the new building was 5 years ago, hence the 5%++ compound growth.

But the fact remains, the building that YOU purchased 5 years ago may have increased only 1.5% compound per year.

This is the ongoing trend with Bangkok property. New buildings constantly set new benchmarks in prices, and then remain the same. With even newer buildings adding a layer on top, setting new benchmarks, and then remaining at the same level. Even newer buildings still, just keep adding another layer on top.

This is why you will find such huge price discrepancy between buildings, even if they are located right next door to each other. An example would be Lumpini 24, a new condominium located on Sukhumvit Soi 24, where prices will fetch around 250,000 Baht/sq.m. So, a 60 sq.m., tiny little 2 bedroom unit will cost around 15,000,000 Baht.

Immediately next door is an older condominium called President Park, where prices have remained stagnant at around 60,000 Baht/sq.m. So, a very spacious 3 bedroom unit of 260 sq.m. will cost you around 15,000,000 Baht.

Four times bigger, located immediately next door, but the same price! So the old adage “Location, location, location” doesn’t apply here. It is ONLY based on the age of the building.

Here is an example of a newer building for sale, 275sq.m. asking 80,000,000 Baht:

Here is an example of an older building for sale in a similar location, 366sq.m. asking 21,000,000 Baht:

Yes, the new condominium is much nicer, better design with newer lobby and sparkling facilities. But is the variation in price fully justified. I mean, 4 times the price!

Baring in mind that the interior of the new condominium will age and need replacing, and if you bought in the older building you can renovated the interior to have it all brand new.

In any event, whether you buy in the new condominium or older building is neither here nor there, the main issue being raised in this article is that prices of new projects may have increased nicely, but once you have invested in your condominium unit, you may not realise the same level of growth that you were told by the developer.

The only ones really seeing huge capital growth, are the land owners. And these are mostly already very wealthy Thai people, as non-Thai’s cannot own land. It doesn’t help the majority of non-wealthy Thai people who still remain financially strapped.

Office rental prices have also remained quite static. Over the past 10 years office rental prices have increased marginally, similar to the apartment buildings. However, as most investors (both Thai and Foreign) seem fixated on condominium buildings, the price of office space for sale has also remained quite static, and arguably office units for sale provide the best option for rental returns, given that office leases are normally minimum 3 years, and you don’t need to renovate the office space like you would with a condominium, with the former requiring a whitewash lick of paint, the latter new furniture, new bathrooms, new kitchen etc.

This is not to say that it is a bad idea to invest in Bangkok real estate. But you need to consider office space and commercial properties as well as residential, and you need to very carefully consider the building, as I previously mentioned, some condominium buildings have seen good growth over the past 10 years, whereas most haven’t.

You need to have a good eye. Best of luck!

Feng Shui Tips for Apartments and Condos

Distinct from the criteria considered standard for a single family dwelling, understanding the unique traits of apartments and condominiums is important in a proper evaluation. In this article about Apartments and Condos, I will cover some important topics specific to these dwellings which exist within larger structures.

Establishing Orientation: The Facing Side Being the View Side m No matter which branch of Traditional Feng Shui you may be learning or studying, it is important to establish the correct orientation of the apartment or condo. This gives way to a lot of insight about the personality of the space and it is the beginning information needed to do any of the calculations related to direction. In the same way that an astrologer needs to know where you were born, a Feng Shui analysis requires that the orientation be defined.

In the olden days, personal dwellings were much more simple and straight forward. The house almost always faced the road it was situated on. But in modern life and architecture, the entrance as an indicator of orientation may come way down the list in terms of the clues which reveal the facing side of the apartment.

Tip: What takes precedence over the entrance in determining orientation is the views. And even if an apartment does not have an expansive view, there might easily be only one view from one side of the apartment, and that is the facing side 99% of the time. The windows, like eyes, will look outward and that is more relevant in determining the facing side than the entrance door. The balcony or patio side of an apartment usually brings in more light too.

If you are studying Feng Shui in an actual school, there will be discussions or instruction regarding a section of learning called Yin-Yang Theory. I have also written about this in all my books. Yin-Yang Theory helps establish which features indicate the facing side of a home, be it a house or apartment. And the side that is lighter, with more views or the only views, can be considered the facing/yang side.

Often, an apartment building or condominium complex will have units on each of the four exterior sides, facing outward, with balconies or patios along all the exterior walls.

Tip: So, within one building there could easily be four different orientation possibilities for all the units, each affording their own view.

Once the facing side has been determined, you will also want to conclude what the real direction is. Which of the eight basic directions does it face? The eight basic directions are North, South, East, West, Northeast, Northwest, Southeast, and Southwest.And which of the twenty-four sectors does it face? There are actually 24 different orientation possibilities because each of the eight basic directions can be sub-divided into three smaller 15-degree increments.

In fact, it is only the New Age version (The Black Hat School) which disregards actual compass directions. This is a shame because some people have only been exposed to this version of Feng Shui and they do not even know what they are missing. As well, once you determine the facing side, the opposite side is called the Sitting side.

Tip: It is the back, the Sitting side, which also establishes the real identity of the space. If you proceed to learn more Feng Shui, it is the sitting side which is referred to as the beginning point of understanding the house type. For example, an apartment that faces east will “sit” west and it then gets referred to as a “west” house. In the Pa Chai School, we learn that people are either east type or west type based on their birth data.

A west type person will do better in a west type apartment than an east type person. And an east type person will do better in an east type house than a west type person. Of course, in many living arrangements, we have people from both the east and west groups, so no one house type can cater to everyone. But there are other ways in which we can tailor a home to the occupant, such as with entrances, sleeping directions, and home office set-ups.