BANGKOK, Thailand – Thailand’s Cabinet approved measures to stimulate the real estate sector by reducing property transfer fees and mortgage registration fees to 0.01%. The initiative targets residential properties, including houses and condominiums priced below 7 million baht, along with a relaxation of Loan-to-Value (LTV) ratio requirements. The aim is to stimulate the real estate market, which plays a crucial role in driving GDP growth.
Phaophum Rojanasakul, the Deputy Finance Minister, emphasized the importance of the real estate sector, noting its interconnectedness with other industries in the supply chain, such as steel production, cement manufacturing, and financial services. He hopes the measure will help address the high levels of unsold properties, with the policy set to remain in effect until June 30, 2026.
Despite the government’s efforts, experts in the real estate market have voiced concerns about the timing of these measures. According to Surachet Kongcheep, Head of Research and Advisory at Cushman & Wakefield Thailand, various issues such as the global economic situation, the upcoming U.S. import tax hikes, and the recent earthquake on March 28 have already impacted consumer confidence and demand for condos. While the reduction in fees is expected to benefit low-rise homes and certain types of condominiums, the overall impact on the condo market may not be substantial.
Sansiri’s Chief Strategy Officer, Phumiphak Julamaneechote, echoed similar sentiments, stating that while the measure could help reduce home-buying costs and encourage growth, it may not be enough to reverse the real estate market’s decline. He attributed the slow recovery to delayed government action, which he described as reactive rather than proactive. He emphasized that the real estate sector is currently facing significant challenges, with household debt and limited purchasing power as major obstacles.
Experts agree that the key to long-term recovery lies in increasing consumer purchasing power. In particular, they highlight the need for banks to release more loans to stimulate growth in the economy and the housing market.
