A condominium model at a house and condo fair in Bangkok. File photo

The number of new condo launches in the second quarter of 2025 dropped to the lowest level in 15 years, reflecting developers' caution about fresh investments amid miserable market conditions pressured by multiple factors.

Frank Khan, partner and head of residential at property consultancy Knight Frank Thailand, said new condo launches for the period tallied only 405 units across two projects, both located in Bangkok's northern suburbs.

"The number of project launches this quarter was the lowest since 2020 and reflected a sharp decline compared to averages in previous years, particularly in the second quarter of 2022 when new supply peaked at 15,164 units, the highest point in five years," he said.

Since then, the market slowed from 2023 to 2025, particularly from the third quarter of 2023, with quarterly new supply not exceeding 8,000 units and even dropping below 3,000 units in some quarters, notably the fourth quarter of 2023 and first quarter of 2024.

"The condo market continues to face challenges from subdued purchasing power and broader economic pressures," said Mr Khan. "Developers must adapt by focusing on value creation and addressing real demand in order to sustain sales in a highly competitive environment."

He anticipated a gradual market recovery towards the end of the year, banking on supportive measures from the government, and interest rates moving in a more accommodative direction, which would help restore confidence and stimulate buying decisions.

In the second quarter of 2025, demand for condos, measured by bookings, stood at 105 units.

Although slightly higher than the previous quarter, this figure was still the second-lowest in the past five years.

Household debt burdens, rising living costs and tighter mortgage lending requirements continued to weigh heavily, particularly on the real demand segment.

New supply launched during the quarter tallied 409 units, an increase from the previous quarter, but still insufficient to drive a meaningful recovery in demand.

The earthquake in March also had a psychological impact on the condo market, especially for completed projects with unsold units.

This contributed to a sharp decline in ownership transfers, which fell to only 12,183 units in the second quarter of 2025 -- the lowest level in more than six years, and significantly below the levels seen during the pandemic period.

This reflected the severity of the ongoing market slowdown, driven by economic uncertainties and negative factors eroding buyer confidence, including high household debt, rising expenses and stricter mortgage lending criteria.

While the number of new project launches in the second quarter decreased, many developers had to extend the timeframe for clearing existing stock, which could lead to higher management costs.

Furthermore, debt repayment challenges faced by some developers during the quarter may have affected the overall financial standing of the real estate sector, prompting price reductions or special sales campaigns to accelerate sales and revenue in order to better manage cash flow and debt obligations.

"Despite these multiple challenges, developers continued to implement proactive strategies to cope with the ongoing uncertainties in 2025," said Mr Khan.

In the second quarter of 2025, the average asking price of condos remained broadly stable.

In the central business district, the average asking price was 239,475 baht per square metre, nearly unchanged from the previous quarter.

Sukhumvit recorded a slight uptick, while Sathon–Silom showed no movement, underscoring weak demand in the high-end market.

City-fringe locations posted a decline, with average prices slipping to 126,897 baht per sq m.

Weak purchasing power and excess unsold stock forced developers to compete aggressively through more attractive pricing strategies.

In suburban locations, the average asking price continued its downward trend, falling to 72,193 baht per sq m.

Developers sought to clear existing inventory by targeting the real demand segment with lower entry-level pricing.

Overall, stable-to-declining prices across key locations highlight a market still highly sensitive to external factors, with competition centred on value creation rather than price increases.