A photographer shoots high-rise buildings in Bangkok from a ledge of the Sathorn Unique tower. Patanapong Hirunard

The condominium market in central Bangkok is expected to be competitive this year with the launch of many new developments and continued demand will ensure opportunities for canny investors, says property consultancy CB Richard Ellis (Thailand).

Foreign investors are also returning, drawn by the stabler political situation and lack of opportunity in their own markets.

The outlook remains bright for super-luxury projects.

Despite being a slow year overall, 2014 saw units at five super-luxury properties achieve record-breaking prices, upwards of 300,000 baht a square metre.

The five were 185 Rajdamri at 330,000 baht a square metre and The Sukhothai Residences, The Ritz-Carlton Residences Bangkok, Magnolias Waterfront Residences and Marque Sukhumvit at 310,000 baht a square metre for each.

“The luxury market has proven to be solid with a low cancellation rate, unlike the speculative market,” said CBRE Thailand managing director Aliwassa Pathnadabutr.

It is important to note that these properties did not achieve their prices based on a single factor.

Location, no doubt, played a key role, but the projects managed to tick several boxes such as understanding market requirements in terms of unit size, style of architecture and interior design; space and functionality; a high standard of specifications and attention to detail; and other selling points such as internationally branded management, amazing views and (most crucially) prime location.

Buyers paying a premium price naturally expect a premium product.

The products that achieve new benchmarks in price are the latest buildings with advanced specifications when compared with older buildings, Ms Aliwassa said.

“This is a niche market which serves the top-end segment,” said James Pitchon, executive director overseeing research at CBRE Thailand.

Price increases are reflected to a somewhat lesser extent in the resale market as well.

Buildings that have been completed over the past 10 years in prime locations, such as Athenee Residence and The Park Chidlom, have achieved prices in excess of 200,000 baht a square metre, which is double the price when they were sold off-plan in the mid-2000s.

Good management, timely maintenance and renovations are the key to value appreciation in older buildings. This is still somewhat of a rarity in Bangkok, however, given the market’s emphasis on new product.

This explains why location is not the sole determinant when it comes to price. It is possible to have a condominium completed before 1997 in which prices have barely moved over the past 20 years.

“Each building has its own individual market characteristics,” Mr Pitchon said.

With land prices on the rise, this could be a new golden era in the making for owners of older buildings who invest in the renovation of common areas and system maintenance at their properties, making them more attractive to prospective buyers.

The midtown and suburban markets are facing challenges of their own. CBRE calculates that more than 100,000 units are due for completion over the next 18 months, the majority of these being one-bedrooms.

Various developers have reported cancellation rates ranging from 15% to 20%, but the real stress test will come when these units are ready to transfer title.

Can developers convert all the presales of units under construction into recognised revenue by transfer of title to buyers, or will some speculative buyers default because they cannot resell? Or will some bona fide end-user purchasers be unable to get mortgages due to increasingly stringent lending regulations?

Affordable landed property such as townhouses and single detached houses are of much interest to families that would like a large living area and perhaps a garden with ample parking.

Families needing a large living area will not select a midtown or suburban condominium because the price per square metre of living area at a condominium in a midtown suburban location is higher than the cost per square metre of living area in a townhouse or single detached house (owing to higher construction costs).

A 100-square-metre condo on Rattanathibet along the MRT Purple Line would cost about 7 million baht. For that price, you could buy a single detached house, with 200 square metres of living area, less than one or two kilometres from a Purple Line station.

Demand for central and suburban condominiums will be limited to one-bedroom units. Given that prices of single detached houses have been rising because of higher land prices, CBRE sees townhouses as the most affordable and therefore most popular type of landed property.

“The next couple of years will be the years of the townhouses,” Mr Pitchon said.