H1 2012 | residential
thailand
Hua Hin, Cha Am & Pranburi Residential MARKET Report
Hua Hin, Cha Am & Pranburi Residential Market Executive Summary More than 360 residential units were supplied in the Hua Hin, Cha Am and Pranburi areas in the first six months of 2012. Approximately 30 units of landed development units were launched in H1 2012. The condominium market was the most fashionable for residential development in the area, with more than 98% of the newly-launched units in H1 2012 being condominiums. Most condominium developers were focusing more on the Hua Hin Coastal area, with nearly 77% of all newly-launched units in H1 2012 located in the area. Most buyers in the Cha Am, Hua Hin and Pranburi areas are Thai, especially in condominiums and housing development projects, while most foreigners purchase in villa projects. The average take-up rate of all property types in the Cha Am, Hua Hin and Pranburi areas is approximately 61%, with 66% for landed development projects and 61% for condominiums. The average price of all condominium projects in the Cha Am, Hua Hin and Pranburi areas is more similar to H2 2012, while increasing by around 2 - 5% for housing and villa development projects.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Hua Hin, Cha Am, and Pranburi Residential Market Historical supply of condominiums, landed property units and plots of land by year, H1 2012
Source: Department of Land and Colliers International Thailand Research Note: The numbers above include condominiums, housing and villas
More than 360 units were completed in the first half of 2012, and the total number of residential units is approximately 11,610 units. The units added in the first six months of 2012 constitute approximately 75% of the total for all of 2011. Cha Am, Hua Hin and Pranburi began to grow
dramatically in 2003, adding more than 800 units per year and Thai buyers became a very strong force in the market due to the proximity to Bangkok.
Historical supply by location and year, H1 2012
Source : Colliers International Thailand Research
The Cha Am area was still the most popular for residential projects, especially from 2005 until the first half of 2012, when there were significant increases compared to the past. From 2009, the Hua Hin Inland area significantly dropped in popularity from the past, due to the condominium market becoming the most fashionable. Nearly 100% of all supply was located outside of the Hua Hin Inland area, which was the
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main location for house and villa development in Hua Hin. In addition, the global economic crisis of the past few years directly affected the foreign market, which is the main target for houses and villas in the Hua Hin Inland area, so developers postponed the launches of their new projects in this area.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Historical supply by property type and year, H1 2012
Source : Colliers International Thailand Research
Condominiums represent, by far, the main source of supply in the Hua Hin, Cha Am and Pranburi areas. Landed development only really took off in 2006 after developers looked at land away from the coast and on the hillsides, targeting the foreign market for villas and affordable second
homes for Thais. Coastal locations have always been most sought after and therefore high land prices meant that condominiums became the most feasible option.
Current supply by location, H1 2012
Source : Colliers International Thailand Research
The total supply of residential units in Hua Hin, Cha Am and Pranburi is approximately 11,610. The Cha Am area contains the highest number with approximately 4,330 units, while nearly 3,800 units and nearly
3,000 units are located in the Hua Hin Coastal and Inland areas, respectively, with only around 520 units in Pranburi.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Condominium Market SUPPLY Historical supply by year, H1 2012
Source: Department of Land, Colliers International Thailand Research
Approximately 360 units were completed and registered at the Department of Land in the first half of 2012. The total current supply amounts to approximately 7,980 units. The condominium market began
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to grow again after the worst three-year period, with nearly 500 units each year.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Historical supply by location and year, H1 2012
Source : Colliers International Thailand Research
The total supply of condominium units is approximately 7,980 with around 47% in the Hua Hin Coastal area. Many developers were focusing more on the Cha Am area in 2011 and 2012 and some huge projects were launched in the Cha Am area, so in the next two to three years, Cha
Am area will represent the biggest share of the condominium market. In addition, the limited land availability in the Hua Hin area was the major obstacle to condominium development there.
Condominium units available for sale, H1 2012
Source : Colliers International Thailand Research
There are approximately 6,900 condominium units available for sale out of a total of around 17,500 at more than 55 projects. The highest number
in Cha Am is at large projects, with a total of nearly 6,000 units launched in the second half of 2011.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 UNITS LAUNCHED Condominium units launched from 2005 to H1 2012 by location
Source: Colliers International Thailand Research
Approximately 1,420 units were launched in the Cha Am area during the first half of 2012 or around 46% of the total units launched in 1H 2012.
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This was due to one big project being launched with more than 1,000 units in the first half of 2012.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 FUTURE SUPPLY Cumulative future supply scheduled to be completed from 2012 to 2014 by location
Source: Colliers International Thailand Research Note: The year completion is expected by developers
More than 4,150 units are scheduled to be completed in the last six months of 2012 in all locations, with around 2,240 units in the Hua Hin Coastal area, 950 units in the Hua Hin Inland area, 930 units in Cha Am and only approximately 30 units in Pranburi. The Hua Hin Coastal area is the preferred location now for condominiums, due to its status and increasing range of entertainment options compared
to Cha Am. Many Thais, usually from Bangkok, buy units in Hua Hin as a location for a second home. A large-scale project in the Cha Am area is scheduled to be completed in 2015 with nearly 6,000 units. Many listed developers were focusing more on the condominium market outside Bangkok, Cha Am and Hua Hin also the one of their target location in the future.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 DEMAND Take-up rate of all condominium projects in the market, H1 2012
Source: Colliers International Thailand Research
The average take-up rate at the end of H1 2012 was approximately 61%, similar to that in the second half of 2011, although more than 3,000 units were launched in the first half of 2012. The take-up rate in the Hua Hin Inland area was significantly higher than the other areas at more than 74%, compared to 62% for the Pranburi
area. This was due to two popular projects from Sansiri Plc. where a total of approximately 560 units were almost sold out after the official launch in April 2012. The total supply in the Hua Hin Inland area was only 2,120 units or 12% of the total supply of all locations, so the average take-up rate in the Hua Hin Inland area was significantly higher.
PRICE Average selling price of condominium units available for sale in Cha Am, Hua Hin and Pranburi
Source: Colliers International Thailand Research
The average selling price of all locations at the end of 2012 is approximately THB61,820 / sq m, similar to the previous six months. The average selling price in the Hua Hin Coastal area is the highest at more than THB70,000 per sq m, but dropped from the second half of
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2011 by around 5%, due to some new projects being launched in H1 2012 at lower prices. The highest prices in the Hua Hin Coastal area are at some completed projects which still have units available for sale.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Hua Hin, Cha Am and Pranburi market for housing and plots of land in developments Note: This report consists of research into multiple housing developments. Individual housing is excluded.
SUPPLY Historical supply by year, H1 2012
Source: Department of Lands and Colliers International Thailand Research
A surge in supply in 2006 and 2007 can be attributed to the effect that the tsunami in Phuket had on the real estate market in other resorts. After the devastation on 26 December 2004, many developers, mostly specialising in landed property, turned their attention to other resort markets, especially the Koh Samui and Hua Hin areas. The effect was a considerably increased supply within a few years, and this came at the start of the revival of the Phuket market and the beginning of the global financial crisis. The main target groups of house and villa development
in the Cha Am, Hua Hin and Pranburi areas are local Thais and foreign buyers. The global economic crisis of the past few years and the debt crisis in the Eurozone affected the foreign market in Thailand including the Cha Am, Hua Hin and Pranburi areas. In addition, the Cha Am, Hua Hin and Pranburi areas are not main business or education cities, so there is limited demand from local Thais for landed development. Developers were postponing the launches of new landed development projects and trying to sell their existing projects.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012
Historical supply by location and year, H1 2012
Source: Department of Lands and Colliers International Thailand Research
The Hua Hin Inland area contains the lion’s share of housing and plots of land in development, due to the high land costs in the coastal areas making it unsuitable for landed development projects. There was a surge in supply from 2003 to 2009 due to confidence in the market following the recovery from the Asian Financial Crisis and the effects of the tsunami in Phuket at the end of 2004 when many developers came to
the Hua Hin Inland area for their new development location. More than 2,300 units launched from 2004 to 2009 are still available now. In addition, the US economic crisis and EU debt crisis affected the wealthy people, so villa developers postponed the launches of their new projects aimed at foreign buyers.
House, villa and plots of land available for sale in the market by location, H1 2012
Source: Colliers International Thailand Research
The Hua Hin Inland area contains, by far, the greatest number of available housing units located away from the coast to the west of Phetkasem Road (Highway 4), which creates a boundary between the Coastal and Inland areas. Many cheaper units are located on the hillside overlooking the coast. The high numbers in the Hua Hin Inland area mean that there
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are many units waiting to be absorbed by the market and that older, unmaintained units may now be difficult to sell. In addition, some projects stopped construction and will restart again only after the buyer signs an agreement.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 UNIT LAUNCHED Housing and plots of land in development projects launched from 2005 to H1 2012 by location
Source: Colliers International Thailand Research
Nearly 30 units were launched in the first six months of 2012, a dramatic drop from the previous year. This was due to the decrease in demand for houses and villas during the past few years. In 2008, 44% of the units were launched, especially in the Hua Hin Inland area. This occurred at the same time as the onset of the Global Financial Crisis and a fall in European exchange rates. This has meant that many units remain unsold or that plots of land still remain vacant. Developers often build to order and the slow take-up means that many projects can resemble on-going construction sites. This will likely remain the situation for some time to come, something which is not in the interests of existing tenants and which presents developers with a difficult dilemma.
During the past two years and up until last year, most developers were focusing more on condominium development along the Coastal area, so the number of new units launched in 2011 decreased from 2010 by nearly 11%. Nearly 30 units were launched in the first six months of 2012 and approximately 56% were developed by SC Asset Corporation Plc. “The Crest Santora Hua Hin� is the first project of SC Asset in the Hua Hin area, comprised of condominiums and villas.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 FUTURE SUPPLY Cumulative future supply scheduled to be completed from 2012 to 2014 by location
Source: Colliers International Thailand Research Note: The year completion is expected by developers
Nearly 1,070 units were scheduled to be completed in 2012 in all locations, and 85% are located in the Hua Hin Inland area. The completion date depends on the developers, due to some housing projects in Cha
Am and Hua Hin being “made to order�, although some developers will start construction as soon as buyers sign an agreement.
DEMAND The take-up rate for all projects in the market by location, H1 2012
Source: Colliers International Thailand Research
The take-up rate in the Hua Hin Coastal area was the highest, but there are only around 255 units in this area. Approximately 64% have been taken up in the Hua Hin Inland area from a total of around 2,000 units, and 60% in the Cha Am area from a total of around 180 units. The takeup rate in the Pranburi area was higher than 65%, due to there being only 100 units there. More than 1,130 units were sold in the Hua Hin Inland area, and although there is no beachfront, many have proved popular due to the price, a sea view location, the cooler climate in the hills and easy access to golf courses.
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Foreigners are the major target group of villa development in the Hua Hin Inland area, but their numbers have been decreasing over past few years, due to the economic crisis in the US and EU. While local Thai demand has increased in the Hua Hin Inland area, most of them are focusing more on housing development projects only and are not interested in villa projects, so the take-up rate in the Hua Hin Inland area is still similar to the past year.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 PRICE Average selling price by location of houses and villas available for sale, H1 2012
Source: Colliers International Thailand Research
The average selling price in the Hua Hin Inland area is lowest, although most villa development projects were located in the Hua Hin Inland area. A lot of the mid-range to low-end housing market is also in this area. The prices at some projects in the Hua Hin Inland area are starting from THB1.1 million for townhouses and up to THB25 million for villas. The average price in the Hua Hin Coastal area is highest, due to some luxury projects being launched with prices from around THB20 to 40 million for beachfront villas.
in the area being located very far from the coast and consisting of only one storey with a small plot of land suitable for two people. There is a great difference in the selling prices in Cha Am at the high and low ends of the market. At the low end are units located on low-lying land away from the coast with relatively small plots and building sizes, while at the high end, are villas located on the coast in what are usually mixed condominium / villa projects that command a premium.
The average selling price in the Hua Hin Inland area is lower than in the Hua Hin Coastal and Cha Am areas, due to many of the housing projects
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Outlook The condominium market in the Cha Am, Hua Hin and Pranburi areas in the first half of 2012 still continues to grow from the previous year. Many developers, especially listed developers, launched their new projects in the area while some other local developers planned to launch their new projects in the second half of this year. Newly-listed developers were coming to the market and looking for investment opportunities in the area especially in the condominium market. Since landed development projects are still out of the buyers’ focus, developers postponed the launches of their new projects during the past year. The coastal area is the most fashionable area for condominium development in the market, but there is limited availability of land at a reasonable price, so some developers have moved their focus to Phetkasem Road and the Hua Hin Inland area. The mid-range market seems to be the new trend for condominium projects in the future. This is due to most Thai buyers looking for their second home with a price not over THB3 - 4 million or not over THB90,000 per sq m.
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Since the Hua Hin city area is very busy and has traffic jams every weekend, especially during the long weekends, many Thais prefer to stay in the Cha Am area to escape the congestion. The Cha Am area has become the new location for a second home because it is more peaceful and convenient, although it still lacks supporting facilities. In addition, there are many available plots of land along the coast and Phetkasem Road at lower prices than in the Hua Hin area. For all of these reasons, developers are focusing more on the Cha Am area. In the Pranburi area, the beach is more tranquil and exclusive which is most appropriate for resort development, although land prices are still reasonable. But due to the lack of support facilities and the long distance to Hua Hin city, there were less projects launched during this year.
Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012
APPENDIX
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 ZONING
For the purposes of research the area is divided into four zones that reflect existing district boundaries.
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Hua Hin, Cha Am, and Pranburi Residential MARKET Report | H1 2012 Hua Hin - Coast Hua Hin is the northernmost district of the province of Prachuap Khiri Khan. It came to prominence in 1922 due to the presence of a summer palace. Since then it has become a magnet for tourists, who were originally predominantly Thai but are now increasingly foreign. The coastal area is defined as being east of Highway 4. This area contains a vibrant mix of higher-end hotels and restaurants and represents by far, the main area for entertainment for the whole of Hua Hin, Cha Am and Pranburi.
Hua Hin - Inland The area to the west of Highway 4 and away from the coast can be described as the first low-lying land offering cheaper accommodation options, while the hillside further west can provide coastal and mountainous scenery as well as cooler weather. Many villa developments have been constructed and are popular with foreigners, especially Scandinavians.
residents taking a weekend break, as prices are generally lower and there is more of a local atmosphere. A number of higher-end establishments have sprouted up especially in the south, on the border with Hua Hin.
Pranburi Highway 4 snakes away from the coast as it leaves Hua Hin, rendering the coastal area of Pranburi, the district south of Hua Hin, more isolated. The beaches are therefore, more tranquil and a feeling of exclusivity has lead to the development of a number of high-end resorts along the beach road. While coastal land is at a premium in Hua Hin, Pranburi offers more available land and could be the area for higher-end developments. However, the further south the road goes, the longer it takes to travel to and from Bangkok, making it a less convenient weekend getaway.
Cha Am This district is in Phetchaburi province and borders Hua Hin to the north. In general, Cha Am flows at a different pace from its better-known neighbour. It has a more rustic feel and is very popular with Bangkok
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