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1 Sep 2023

Real Estate and Construction

Housing market is still reeling from numerous challenges…Close attention must be paid to related government measures (Current Issue No.3431 Full Ed.)


        KResearch is of the view that although the Thai housing market will continue to be supported by several factors during the remainder of 2023, such as the resumption of foreign buyers, reductions in ownership transfer fees and mortgage registration fees for homes worth not more than THB3 million/unit, and aggressive promotions from real estate developers, it will likely face numerous challenges, as well.  Among these include the fact that home demand has partially been absorbed during the relaxation of LTV regulations, consumer purchasing power has yet to fully recover, hefty household debt, rising mortgage interest rates, which affect monthly installment payments and new loans.  
        As the Thai housing market is still reeling from numerous risks, we at KResearch expect that the number of home ownership transfers in the Bangkok Metropolitan Region will contract around 7.8 percent in 2023. However, if various factors become more stable, the figure may grow roughly 1.2-4.6 percent during 2023. Looking ahead, close attention must be paid to the details, timing and effectiveness of the new government's measures. Preliminarily, its economic stimulus measures will focus on low-to-middle income earners. If such measures, including those aimed at supporting the recovery in the housing market, are implemented efficiently, they will help bolster growth in the housing market during 2024.
        Even as the residential market looks somewhat bright, the development of housing projects will continue to face a number of challenges, including a high number of unsold units and the fact that it may take a while for demand to pick up. Real estate developers may have to be cautious about investment in new projects amid rising operating costs and a declining population.

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Real Estate and Construction