A decrease in the growth of house prices amid a slowdown in steel resilience.

The price index for the construction of standard homes increased by 1.5% compared to last year in the third quarter of 2023, continuing a trend of slowing down, which was caused by a decrease in prices for steel and plumbing materials.

According to data from the Real Estate Information Center (REIC), the construction price index in the third quarter of 2023 was 134.2, which is 0.1% higher than in the second quarter of 2023 and 1.5% higher than in the third quarter of last year.

“The main factor for growth compared to last year was the price of architectural projects, which increased by 3.6%, while the other three types of work decreased,” said Vichai Viratkapan, acting CEO of REIC.

The other three types of work are structural engineering, sanitary systems, and electrical and communication systems, the prices of which have decreased by 2.6%, 1.7%, and 0.1% respectively.

As for the prices of building materials, the highest annual increase was noted for tiles, which rose by 16.6%, followed by wood and wooden products, which increased by 4.8%, and other building materials, which grew by 2.6%.

Steel and steel product prices have decreased significantly compared to last year, dropping by 9.6%, followed by plumbing, which fell by 8.9%. Concrete products and electrical and water supply equipment saw a slight price drop of 1.1% and 1%, respectively.

“The decrease in steel prices was related to global price adjustments in the market, according to supply and demand, as the surplus of steel caused by the real estate crisis in China reduced the demand for steel in the country,” he said.

As a result, part of the excess supply from China was delivered to Thailand, Mr. Vichai said.

According to REIC, labor costs, which account for 39.7% of the prices for standard home construction, have slightly increased in the third quarter of 2023, rising by 1.1% compared to last year. The government's promise to raise the daily minimum wage to 400 baht has raised concerns among both developers and builders, the center reported.

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