As a result, developers have delayed new launches this year, but they can't wait until calm returns, Surachet says. He expects concerted marketing activities in the second half in an attempt to win back buyer confidence and boost the market. "Foreign investors" are still active in the market, Surachet says, and now could be a good time for them to secure discounted real estate.

He explains that many completed projects are still waiting for transfer. Banks have been stricter when considering mortgage loans during the past few months, with 25 to 30 per cent of applicants being declined. "As result, developers may need to sell at a lower price than they expected last year."

Dan Tantisunthorn, head of research, JLL Thailand, agrees that while some prospective foreign buyers are certainly put off by the recent political events, "others see the softer market as an opportunity to buy".

CBRE Thailand also reflects a slow start to the year. Although more than 90 per cent of luxury condominium The Diplomat Sathorn was sold within two months of its launch, that project was an exception. "We are concerned about saturation in a number of midtown/suburban locations, especially with the number of completions scheduled over the next two years," CBRE's report notes.

Political problems have clearly weakened demand, says CBRE, but other factors, such as reduced cash flow, increasing consumer debt and banks' caution on project lending, also come into play.

James Pitchon, executive director - head of CBRE Research and Consulting, Thailand, describes Bangkok as a complex market, where not every sector has suffered. Hotel occupancy dropped to around 50 per cent during first-quarter political unrest, and retail sales slumped owing to lack of tourist spend. However, the office sector remained robust - vacancy rates have fallen to the lowest level in 20 years, to below 10 per cent, and rentals are rising. A similar mixed bag is evident in the residential sector, Pitchon says.

"In downtown Bangkok, there is a limited amount of future supply currently under construction, and a significant reduction in built but unsold inventory that in some developments were a hangover from GFC in 2008. While we are seeing a downturn in primary sales and resales, because of the limited supply, we've actually seen prices rise," he says.

It's been "the complete opposite" in the mid-town and suburban condominium market, where most developers have built one-bedroom units aimed at first-time homebuyers. "That is the sector we are most concerned about, because we will see a peak in completions in 2014 and 2015 with an average of close to 70,000 units per year for the next two years," Pitchon says.

Many of these projects have sold well on paper, owing to a pricing split of 10 per cent down on contract signing and construction, and 90 per cent on completion. This makes such projects "an attractive speculative bet", but if the buyer ends up walking away, the developer is left with built but unsold inventory.

As for the May 22 coup, Pitchon says overall dynamics have not changed. "We are not so worried about the downtown market; we are worried about the mid-town market."

Property markets move "a little bit like oil tankers - slowly", he says, but it is "far too early to give an authoritative judgment".

By the end of the first week after the coup, CBRE had closed a few deals - including the 3.2 billion baht (HK$762.2 million) sale of the Hilton Hua Hin Hotel. "We're not selling at the same rate as we were prior to the coup, which had already been a little up and down. But these were fresh [post-coup] deals," Pitchon says. "They're not in huge volume; yes it's slower, but we have not ground to a halt."

There were even a few foreign buyers in the mix, he says - investors familiar with the Thai market's ups and downs.

"What's being offered in Bangkok compared to other regional markets is still attractive. The feeling that there isn't much new supply, and seeing price increases in the best buildings, is attracting purchasers," he says. "It is still a cash market for most foreign purchasers. Foreigners can own up to 49 per cent of a freehold condominium building, but it's difficult to borrow money. In the condo sector, the downtown market will be slower, but we don't see downward pressure on pricing in the best buildings."

Developers know that action must be taken to move unsold inventory and this may translate to some value offerings in the mid-market sector - but that's not where expatriates want to live.

Pitchon says that for overseas investors, apartments and condos suitable to house expatriates still represent the best rental income potential.

Buying Guide

A top-of-the-range superluxury condominium at Marque Sukhumvit, an architectural icon under construction next to Emporium and EmQuartier shopping complex, 30 metres from the skytrain. There's a maximum of four units per floor in the 50-storey tower, featuring bespoke detailing, a golf simulator, squash court, sky cigar and wine bar and celestial garden on the 50th floor. Expected completion: Q4, 2016. Prices range from 32 million baht (HK$7.62 million).

A studio at Double Lake Muang Thong Thani (Phase II), a low-rise condominium with direct lake views, one minute's drive to the expressway and Impact Link service to BTS Mochit Station. Building facilities include a pool, yoga terrace, fitness centre and landscaped garden.

Agent: CBRE