Thailand's Finance Ministry to Support Property Sector Following Earthquake
Measures under consideration to restore confidence in the real estate market post-earthquake.
The Ministry of Finance in Thailand is preparing to implement measures aimed at revitalizing the country's property sector, which has faced a decline in confidence following a significant earthquake that struck Myanmar on March 28, with notable impacts felt in Bangkok.
The earthquake's aftermath has raised concerns particularly around high-rise buildings and condominiums in the region.
Officials from the Ministry have indicated that ensuring public confidence is a primary objective.
Notably, the structural integrity of existing high-rise buildings has been affirmed, as most were unaffected, with the exception of the State Audit Office currently under construction.
Potential stimulus measures being considered include reductions in transfer and mortgage registration fees, along with adjustments to loan-to-value (LTV) ratios for mortgages.
Historical data shows that similar measures during the pandemic resulted in a growth rate of 11-12% annually in the real estate sector.
Before the earthquake, the property market had begun to show signs of recovery, particularly in the condominium segment, according to ministry officials.
In addition to support for property sales, Deputy Finance Minister Paopoom Rojanasakul announced that the Treasury Department is evaluating possible assistance for tenants of state-owned properties that were impacted by the earthquake.
Alongside this, he has directed the Office of the Insurance Commission to expedite claims payments from insurance companies for earthquake-related damages.
While the full economic effects of the earthquake are still being assessed, Paopoom noted that a temporary decline in domestic demand may occur, influenced by shifts in consumer spending and an increase in remote working arrangements.
He stated that, despite these immediate impacts, he does not foresee any long-term challenges to economic stability, expressing optimism about a gradual recovery of consumer confidence.
However, he acknowledged that the earthquake may have induced a psychological impact on potential buyers in the real estate market, potentially leading to a preference for low-rise housing as a safer alternative to high-rise condominiums.
The earthquake's aftermath has raised concerns particularly around high-rise buildings and condominiums in the region.
Officials from the Ministry have indicated that ensuring public confidence is a primary objective.
Notably, the structural integrity of existing high-rise buildings has been affirmed, as most were unaffected, with the exception of the State Audit Office currently under construction.
Potential stimulus measures being considered include reductions in transfer and mortgage registration fees, along with adjustments to loan-to-value (LTV) ratios for mortgages.
Historical data shows that similar measures during the pandemic resulted in a growth rate of 11-12% annually in the real estate sector.
Before the earthquake, the property market had begun to show signs of recovery, particularly in the condominium segment, according to ministry officials.
In addition to support for property sales, Deputy Finance Minister Paopoom Rojanasakul announced that the Treasury Department is evaluating possible assistance for tenants of state-owned properties that were impacted by the earthquake.
Alongside this, he has directed the Office of the Insurance Commission to expedite claims payments from insurance companies for earthquake-related damages.
While the full economic effects of the earthquake are still being assessed, Paopoom noted that a temporary decline in domestic demand may occur, influenced by shifts in consumer spending and an increase in remote working arrangements.
He stated that, despite these immediate impacts, he does not foresee any long-term challenges to economic stability, expressing optimism about a gradual recovery of consumer confidence.
However, he acknowledged that the earthquake may have induced a psychological impact on potential buyers in the real estate market, potentially leading to a preference for low-rise housing as a safer alternative to high-rise condominiums.
