Under the loan program, the Government Housing Bank will offer first-time homebuyers a mortgage at zero interest for the first two years if it is less than three million baht, with a full term of 30 years. Homebuyers with less than one million baht annual income can borrow up to one million baht.
Successful applicants are also eligible for a waiver on a mortgage fee at 1 percent of the loan amount and an ownership transfer fee at 2 percent of the appraisal price. The Bt25 billion amount is equivalent to 8 percent of the new mortgage loans extended each year.
According to a report by the Land Department and the Real Estate Information Center, property ownership transfers in Bangkok and its environs in the first two months of this year totaled 18,907 units, down 21 percent from the same period last year.
The decline in property market activities stemmed partly from the lack of property stimulus measures taken earlier.
Simultaneously, commercial banks had begun a gradual increase in lending rates with four major banks offering a minimum lending rate at 6.75 percent. Each 1 percent increase in lending rates will have the approved loan amount reduced by 7-8 percent. That means the purchasing power of homebuyers will decrease accordingly.
With the implementation of the loan program, KRC said, the property market is expected to be active again for the remainder of the year.
At present, housing units that are completely built and those under construction are available in a large number, so it is a good opportunity for property developers to accelerate the marketing and sale of housing units left in stock. (MCOT online news)