Thailand Business News –
|Condominium prices are expected to rise further by 20-25 per cent this year with the number of condominiums seeking new registration set to increase by more than 100, according to the Treasury Department.|
|Thailand Business News|
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Bangkok’s condo prices likely to rise by 20% in 2011
Thailand’s property sector is showing signs of an early recovery, as selective investors return to purchasing real estate stocks and actual property.
Some of the credit goes to a one-year government stimulus package that reduces the Special Business Tax from 3.3% to 0.11%, extends the reduction on transfer taxes from 2% to 0.01% and mortgage registration fees and provides a tax deduction on mortgage principal and interest.
Thailand’s property indicators show:
1.The Stock Exchange of Thailand (SET) index began rebounding in April 2009, and property stocks – while the first to fall in H2/08 – were amongst the first to recover
2. The Bank of Thailand (BoT) has lowered its policy interest rate four times since December 2008, prompting banks to reduce the minimum lending rate (MLR) from 7.25% to 6.25%
3. A continued drop in sales of durable goods due to uncertainty surrounding the economy is highlighted consumer confidence index (CCI) to a historic low of 72.8 in Q1/09 and New housing registrations in Bangkok and surrounding areas fell 43.8% in Q1/09
Later, as investors tried to rebuild their diminished wealth, they turned to the very sector they had abandoned first, property development.
First, and unlike Europe or the US, where government subsidies and financial aid are the only things artificially holding up the sector, the kingdom’s housing market benefits from genuine demand, with limited influence from speculators and foreign-based buyers.
Property market in Thailand remained in a strong position thanks to good sales in the first quarter which were not only driven by the incentives. The stock market is risky to invest in, while buying gold for investment has limitations.
The recovering economy is re-building consumer confidence while homebuyers’ purchasing power is also strong, he said. Development of the mass transit network in Bangkok was another boost for the market. Politics has had little impact on condominium sales but it has dampened investment and the industrial, commercial and tourism sectors.