# RECORD e2aec14baa7ef3008564e4685e54665957939139
# TITLE: Determinants of Luxurious Condominium Prices in Bangkok CBD: A Case study of Encouraging Housing Affordability in Bangkok, Thailand
# YEAR: 2022.0  VENUE: International Review for Spatial Planning and Sustainable Development  DOI: 10.14246/irspsd.10.1_167
# AUTHORS: Pornraht Pongprasert
# PAGES: 16  CANDIDATE TABLE PAGES (1-based): [12]
# ABSTRACT: : This study aims to find the factors influencing prices of luxurious condominiums within 1-km radius of urban rail transit stations in Bangkok CBD, where the property value rapidly increases since last decade. According to recorded data, the average price of condominiums in CBD is higher, nearly 28% during 2016-2019. Besides, the growth of luxurious condominium in these areas grows higher sharply. 52% of new condominiums are above Luxury class while housing affordability of Bangkok’s largest population is too low. Also, urban policy cannot control the unpredictable price of condominiums in CBD. As a tool for urban planners, post-windfall gain tax would be collected from real estate developers who get uplift property values as result of public infrastructure planning. It would be used to fund infrastructure such as transit, affordable housing. This paper can recommend urban policy planners which factors influencing unpredictable price of luxurious condominium in CBD should be considered in condition of windfall profit taxation. In addition, results suggest developers to set more reasonable price of new luxurious condominiums near rail station in CBD. In this study, 55 luxurious condominiums constructed within 5 years are research samples. Hedonic approach is applied to study the effects of location, structural and neighborhood attributes of luxurious condominium price in Bangkok CBD. Results are shown 6 key attributes; the number of units, percentage of car parking space/unit, locating private recreation park within project area, rate of common area fee, location of building in street corner and distance to expressway are interrelated to luxurious condominium price near urban rail transit stations in Bangkok CBD.


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167 
International review for spatial planning and sustainable development D: Planning Assessment, Vol.10
No.1 (2022), 167-182 
ISSN: 2187-3666 (online) 
DOI: http://dx.doi.org/10.14246/irspsd.10.1_167 
Copyright@SPSD Press from 2010, SPSD Press, Kanazawa 
Determinants of Luxurious Condominium Prices in 
Bangkok CBD: A Case study of Encouraging Housing 
Affordability in Bangkok, Thailand 
Pornraht Pongprasert1* 
1 Department of Real Estate Business, Thammasat Business School, Thammasat University 
* Corresponding Author, Email: pondmail@hotmail.com 
Received: June 15, 2019      Accepted: Nov 06, 2021 
Key words: 
Luxurious condominium prices, Hedonic pricing model, Central business 
district, Bangkok  
Abstract: 
This study aims to find the factors influencing prices of luxurious 
condominiums within 1-km radius of urban rail transit stations in Bangkok 
CBD, where the property value rapidly increases since last decade. According 
to recorded data, the average price of condominiums in CBD is higher, nearly 
28% during 2016-2019. Besides, the growth of luxurious condominium in 
these areas grows higher sharply. 52% of new condominiums are above 
Luxury class while housing affordability of Bangkok’s largest population is 
too low. Also, urban policy cannot control the unpredictable price of 
condominiums in CBD. As a tool for urban planners, post-windfall gain tax 
would be collected from real estate developers who get uplift property values 
as result of public infrastructure planning. It would be used to fund 
infrastructure such as transit, affordable housing. This paper can recommend 
urban policy planners which factors influencing unpredictable price of 
luxurious condominium in CBD should be considered in condition of windfall 
profit taxation. In addition, results suggest developers to set more reasonable 
price of new luxurious condominiums near rail station in CBD. In this study, 
55 luxurious condominiums constructed within 5 years are research samples. 
Hedonic approach is applied to study the effects of location, structural and 
neighborhood attributes of luxurious condominium price in Bangkok CBD. 
Results are shown 6 key attributes; the number of units, percentage of car 
parking space/unit, locating private recreation park within project area, rate of 
common area fee, location of building in street corner and distance to 
expressway are interrelated to luxurious condominium price near urban rail 
transit stations in Bangkok CBD. 
1. 
INTRODUCTION 
During the last 10 years, the average price of condominiums in Bangkok, 
especially in CBD, has grown higher because of an increase of land price in 
Bangkok. Moreover, some developers equip their projects with much more 
facilities and amenities and set the sale price higher. Some are necessary, but 
some are not needed among residents near rail services such as car parking 
space. This marketing strategy obviously contradicts to the concept of 
sustainable urban development near public transit station or transit-oriented 
development (TOD) which enhances real estate developers to design the 
surrounding area around transit station useful for rail ridership in the city, 
and for reducing car ownership and use by station-area residents. Low-and 


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178 
IRSPSDD International, Vol.10 No.1(2022), 167-182 
 
units, higher number of available car parking spaces, locating private 
recreation park in the project, setting higher common area fee and location of 
building in the corner of street, the sale prices of luxury condominiums 
would be higher.  
Table 3. The regression coefficients of 3 functional forms 
Variables 
Model 1 Linear 
functional form 
Model 2 Semi-log 
functional form 
Model 3 Double-log 
functional form 
DIST_TO_ST 
14.93413 
(0.521) 
.00001 
(-.355) 
-.00781 
(-.267) 
CORE_CBD 
2640.75367 
(.191) 
-0.0400 
(-.258) 
-.00833 
(-.216) 
UNITS 
69.28454* 
(1.786) 
.00008* 
(1.767) 
.03358 
(.513) 
FLOORS 
-483.23396 
(-.861) 
-.00038 
(-.600) 
-.04395 
(-.935) 
AREA 
-4.16441 
(-1.378) 
-.00001 
(-1.522) 
-.01511 
(-.329) 
FACILITY 
-13592.16403 
(-.921) 
-.01804 
(-1.089) 
-.00618 
(-.136) 
DEVELOPER 
13892.27443 
(.881) 
.01976 
(1.117) 
.05353 
(1.163) 
CAR_PARK 
528.34177*** 
(3.070) 
.00060*** 
(3.085) 
.10543 
(1.447) 
PARK 
46997.97505*** 
(3.115) 
.06900*** 
(4.076) 
.15030*** 
(3.525) 
FEE 
1530.39732*** 
(4.336) 
.00189*** 
(4.773) 
.38470*** 
(4.360) 
CORNER 
25253.07083 
(1.59) 
.04489** 
(2.277) 
.07695 
(1.519) 
MAIN_RD 
15.79588 
(.542) 
.00001 
(.288) 
-.00219 
(-.193) 
EXPWAY 
-24.97502*** 
(-2.734) 
-.00003*** 
(-2.760) 
-.08183*** 
(-2.855) 
DEPART 
.55753 
(.041) 
.00001 
(.361) 
.00861 
(.350) 
SCHOOL 
5.20411 
(.261) 
.00001 
(.298) 
.00813 
(.308) 
HOSP 
6.90188 
(.421) 
.00002 
(.961) 
.03615 
(1.176) 
   Constant 
88577.789** 
(2.168) 
5.18966*** 
(113.200) 
10.57771*** 
(15.153) 
Observations 
55 
55 
55 
R2 
0.805 
0.861 
0.830 
Adjusted R2 
0.722 
0.802 
0.758 
F-statistic 
9.777 (Sig. 0.00) 
14.669 (Sig. 000) 
11.593 (Sig. 000) 
Note: The number in the table is the coefficients of variables but the number 
in parentheses is t-statistic 
*** Significance level at 0.01; **Significance level at 0.05 and 
*Significance level at 0.1  


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Pongprasert
179
 
5. 
CONCLUSION AND RECOMMENDATIONS 
Bangkok is now one of the most expensive cities in Asia in terms of 
residential property price (Group, 2021), with a lack of available affordable 
housing. The lack of sufficient financial tools for ensuring new housing is 
truly affordable for low and middle incomes (the largest group of population 
in Bangkok). According to the data of average household income in 
Bangkok in 2019, it can be concluded that half of people from middle-class 
and below cannot afford to live in condominium because of their low 
housing affordability. The biggest size of condominium they could afford is 
only 20-sq.m. (smallest as required by law) in the middle range class and 
only 7.08 sq.m. (smaller than required by law) in luxury class condominium 
of which most developers prefer to launch the construction project near 
urban rail routes and set the high price. The prices tend to grow rapidly and 
they are difficult to predict. In addition, more speculators or real estate 
investors buy and sell condominium rooms in higher prices for their own 
benefit at the same time. The market pays no attention to residents needing 
to live near transit station in CBD area. In this situation, the inequality 
problem becomes critical. Low-and mid-income people cannot live near 
areas of employment, recreation and public mass transit systems in Bangkok 
CBD. Several people say, “You could not live in an urban area of Bangkok 
(especially in CBD area) unless you are rich”. This contradicts to the 
direction of sustainable urban development in the city as mentioned in the 
Sustainable Development Goal (SDG) no.11 as to make cities and human 
settlements inclusive, safe, resilient and sustainable.  
In 2018, The Thai government initially discussed how to increase the 
housing affordability among most people and how to manage the greater 
prices of residential property, including land speculation in Bangkok CBD. 
The Windfall Gains Tax was introduced and planned to use in Bangkok in 
the near future. It is a tool of urban policy planners to control unpredictable 
land and property prices and to create more sustainable urban development. 
The approach is to collect increment land value tax from land owners and 
real estate developers gaining profits from the transport infrastructure 
projects invested by government. First, the ceiling for the windfall gain tax is 
at 5% of the inflated value of property from infrastructure projects. As for 
benefits, this tax revenue is used by government to fund the new transit 
infrastructure and useful for the creation of more affordable housing and 
suppress the growth in land value when affordability is a critical. The 
inflated value of residential property is exactly affected from transport 
infrastructure projects. However, in fact, there are many factors related to 
unpredictable prices of luxurious condominiums like locational, structural 
and neighborhood attributes. These could be used in criteria of charging 
either the windfall gains tax system or other property tax systems in 
Bangkok. In this paper, the factors influencing the luxurious condominium 
prices in Bangkok CBD have been investigated. The expected outcomes 
should bring benefits to 3 groups of people; urban policy planners, 
developers and customers. Policy planners will deeply understand 
condominium attributes directly affecting to the inflated prices of luxurious 
condominium. The expected results would be their guidance to plan the 
policies such as property tax policy and sustainable urban development 
policy. At least, the factors can be set in the criteria of charging the higher 
rate of windfall gains tax from developers. When the city government gets 
more tax revenues, the infrastructure and affordable housing projects in a 
new town/village near urban rail stations would be subsidized in Bangkok