Bangkok’s condominium market is heading for its lowest year of new supply in a decade. For property buyers across Thailand, including Phuket, the supply crunch signals a market shift worth understanding.
Tritecha Tangmatitham, managing director of SET-listed developer Supalai, told Bangkok Post that condominium launches this year will likely fall below last year’s level, which was already the lowest in ten years. The cause is not simply weak demand—it is a combination of weak purchasing power, high mortgage rejection rates and subdued foreign demand that has made developers reluctant to launch new projects.
Why mortgage rejection matters more than expected
One detail worth paying attention to is the rising mortgage rejection rate. Supalai’s rejection rate has climbed to 17% this year from 15% last year, and that figure sits below the industry average.
The reason is not always obvious to buyers. Tritecha explained that many prospective buyers underestimate the impact of “buy now, pay later” spending and delayed repayments on small purchases. They assume minor instalments or late payments will not affect mortgage applications.
“Banks count everything,” he said. “Even small late payments affect borrowers’ credit discipline, making it harder to obtain housing loans.”
In plain English, the barrier to buying is not always affordability—it is creditworthiness. This matters across Thailand’s residential property market, not only in Bangkok.
Supply contraction is sharper than demand decline
The key point is that supply has fallen faster than demand.
Tritecha noted that developers have sharply reduced land acquisitions in recent years, and banks have become more cautious about providing project financing. Many lenders now require developers to secure presales of around 70% before extending construction loans, making it difficult for many companies to launch new projects.
Only two condominium projects entered the environmental impact assessment approval process this year, compared with 12 to 14 projects annually in previous years.
“Demand has weakened, but not nearly as much as supply,” Tritecha said. “Eventually, the market will face a shortage of new condominium supply.”
This is not speculation. The figure speaks to a pipeline that has effectively dried up.
What the first-half figures show
According to property consultancy Cushman & Wakefield Thailand, 2,332 condominium units were launched in Greater Bangkok during the second quarter of 2025, down 67% from 7,169 units in the first quarter.
Although first-half launches totalled about 9,500 units, up 42% from the same period last year, the increase reflected a stronger first quarter before developers sharply scaled back launches in the second quarter.
Surachet Kongcheep, head of research at Cushman & Wakefield Thailand, expects new condominium launches this year to remain below 20,000 units. He said developers have become increasingly cautious as local purchasing power weakens and Chinese demand—once the largest foreign buyer group in Bangkok’s condominium market—continues to decline without being fully replaced by buyers from other countries.
Why developers are selling inventory, not launching projects
Instead of launching new projects, many developers are now focusing on selling existing inventory. Some are disposing of completed units in bulk to improve cash flow. Others have postponed new projects after struggling to sell completed condominiums or having to settle construction payments with contractors using completed units instead of cash.
Surachet explained that the market environment has completely changed. In previous downturns, developers could stimulate demand by launching cheaper products. Today, affordable units also struggle because many buyers cannot obtain mortgages.
This shift changes the opportunity set for buyers. Completed inventory at discounted prices may become more available, but new supply will be constrained.
What this means for Phuket property
Phuket’s condominium market operates differently from Bangkok. Tourism-linked rental demand, foreign buyer interest and resort-lifestyle positioning create distinct dynamics. However, the same supply and financing constraints apply.
If Bangkok developers are delaying projects due to tighter bank lending and higher presale requirements, Phuket developers face similar conditions. If mortgage rejection rates are rising nationally due to credit discipline concerns, Phuket buyers are not immune.
The supply crunch also matters for investors comparing Bangkok and Phuket. If Bangkok’s pipeline has shrunk to a decade low, Phuket’s new supply may also be more constrained than recent years suggest. For buyers, this could mean fewer new projects to choose from, but also less competition from future supply if demand recovers.
The detail worth watching is whether Phuket developers respond with the same caution or whether tourism-driven demand allows for more launches. The source material does not provide Phuket-specific figures, but the national lending environment and developer sentiment are shared constraints.
What remains uncertain
Surachet noted that downside risks remain, particularly from ongoing geopolitical conflicts, including tensions in the Middle East, which could further weaken buyer confidence during the second half of the year.
The long-term question is whether the supply crunch will eventually tighten the market enough to lift prices and restore developer confidence, or whether weak purchasing power and high rejection rates will keep demand subdued even as supply falls.
Tritecha remains optimistic about the long-term condominium market, but the path from supply shortage to market recovery is not yet clear.
Frequently Asked Questions
Why are Bangkok condo launches at a decade low?
Developers are delaying new projects due to weak purchasing power, high mortgage rejection rates and subdued foreign demand. Banks now require higher presale levels before providing construction loans, making it difficult for many companies to launch new projects. Only two projects entered environmental impact assessment approval this year, compared with 12 to 14 annually in previous years.
How does mortgage rejection affect property buyers?
Mortgage rejection rates have risen to 17% at Supalai, above last year’s 15%, and higher across the industry. Banks count all credit activity, including small “buy now, pay later” instalments and late payments, which affect borrowers’ credit discipline. This makes it harder for buyers to obtain housing loans, even for affordable units.
Could this supply crunch affect Phuket property?
Phuket developers face the same national lending constraints and higher presale requirements from banks. If Bangkok’s pipeline has shrunk to a decade low, Phuket’s new supply may also be more constrained. For buyers, this could mean fewer new projects but also less future supply competition if demand recovers.
Are developers launching cheaper units to stimulate demand?
No. Cushman & Wakefield’s head of research explained that in previous downturns, developers could stimulate demand by launching cheaper products. Today, affordable units also struggle because many buyers cannot obtain mortgages. Developers are instead focusing on selling existing inventory.
What is the long-term outlook for Thailand’s condo market?
Supalai’s managing director remains optimistic, noting that supply has fallen faster than demand. He expects the market will eventually face a shortage of new condominium supply. However, the path from supply shortage to market recovery depends on whether purchasing power and mortgage access improve.
Sources
- Bangkok Post — Condos set for another record-low year — link
