Bangkok and its surrounding provinces are experiencing a decline in condominium transfers because the younger technology, Gen Z, is opting to hire somewhat than purchase properties. The ttb analytics centre predicts a 12.5% drop in transfers this year. Experts advise builders to attract Gen Y consumers with excessive monetary readiness.
In their current evaluation, ttb analytics pointed out that condo gross sales in Bangkok and adjacent provinces are under stress due to the behavioural differences of Gen Z buyers. Primarily driven by way of life preferences and monetary limitations, these people are leaning towards renting properties instead of buying. As a result, rental transfers are anticipated to shrink between 8.4% and 12.5%.
Property builders are urged to adapt their methods in the direction of smaller families of the Gen Y class, who’re financially sound and wanting to make property purchases. This generation presents a potential remedy for slowing apartment sales and catering to the changing preferences of homebuyers. During Wacky , property transfers hit a document excessive of 1.05 trillion baht, with sixty one.9% of the value linked to housing transactions in Bangkok and surrounding areas.
Interestingly, the market share of residential properties in Bangkok and adjacent provinces has been on a transparent decline compared to the remainder of the nation. Bangkok and neighbouring places have seen transfer values decrease from a mean of 67% over the previous 5 years to solely 34% in 2023. Furthermore, the property gross sales market is going through structural challenges, pushing the sector into the ‘Generation Rent’ era. This, mixed with the increase in switch values, resulted in additional individuals opting to lease as a substitute of purchase.
There are two key drivers propelling the shift in course of renting among the many Gen Z population, aged between 14 and 28 years old. Firstly, the disconnect between the revenue ranges of this era and the pricing of condominiums within the central business districts is apparent. Secondly, the structure of the property market has increased the worth of newly built condos, with building material prices rising by sixteen.3%. Consequently, renting becomes a more interesting option because it offers flexibility in case of job modifications..