A view of Bangkok skyscrapers from Mahanakhon Skywalk. Land prices in Bangkok's inner-city locations have been continuously increasing. (Photo: Patipat Janthong)

The rise in land prices in Bangkok's inner-city locations was among the top five largest increases in both the first and second quarters of 2024, reflecting the trend of higher volumes of new condo supply launched in these areas.

Vichai Viratkapan, acting director-general of the Real Estate Information Center (REIC), said land transactions in Bangkok's inner-city areas typically involved smaller plots, yet commanded high prices.

"Land prices in Bangkok's inner-city locations have been continuously increasing, which might be attributed to large-scale development projects by both the government and the private sector," he said.

These developments often include mixed-use projects featuring office buildings, retail spaces and high-rise residential towers.

Many of these projects were developed as condos, aligning with REIC's residential market data for the first quarter of 2024, which showed a surge of 269% year-on-year in new condo launches in Bangkok's inner-city areas.

According to REIC, the year-on-year rise in land prices in Bangkok's inner-city locations in the second quarter of 2024 was 17.8%, the second-largest increase, following Nakhon Pathom, which posted growth of 82.1%.

The inner-city areas comprise 12 districts: Chatuchak, Huai Khwang, Yannawa, Watthana, Klong Toey, Phaya Thai, Bang Kholaem, Pomprab Sattruphai, Bang Sue, Din Daeng, Ratchathewi and Bang Rak.

The second quarter was the second straight period where the land price increase in these locations ranked among the top five, after securing fourth in the first quarter of 2024 with a 10.1% uptick.

Recent instances when the areas ranked among the top five include the third quarter of 2023, placing fifth with a gain of 6.8%, and the fourth quarter of 2022, ranking fourth with growth of 16.6%.

Other locations in the top five were mostly in Bangkok's neighbouring provinces: Nakhon Pathom, Pathum Thani, Samut Prakan, Samut Sakhon and Nonthaburi.

"This trend was largely driven by two factors," said Mr Vichai.

"One was urbanisation, facilitated by the development of road networks, including expressways as well as new and extended mass transit rail systems."

The other factor was land prices in suburban areas remained relatively low, allowing developers to build residential projects aligned with the purchasing power of people seeking low-rise housing, while also developing commercial spaces in these suburbs.