The Ministry of Finance is poised to take steps to help the property sector, aiming to swiftly restore public confidence following last week’s earthquake.
Confidence in the property sector, particularly in high-rise buildings and condominiums, has been shaken in the wake of the March 28 quake that struck Myanmar and also had a heavy impact in Bangkok.
One priority will be to stress the soundness of engineering principles, as the quake did not affect high-rise buildings in the country, except for the State Audit Office under construction, said a ministry official who asked not to be named.
The most effective real estate stimulus measures include reductions in transfer and mortgage registration fees, as well as relaxing loan-to-value (LTV) regulations for mortgages, said the official. These measures were used during the pandemic and led to expansion of 11-12% a year.
Before the earthquake, the real estate sector, especially condos, was showing signs of improvement, said the official.
In a separate development, Deputy Finance Minister Paopoom Rojanasakul said the Treasury Department, which oversees state-owned land and properties nationwide, is considering assistance measures for tenants of state properties affected by the earthquake.
Mr Paopoom said he has also instructed the Office of the Insurance Commission to ensure that insurance companies expedite claims payments for earthquake-related damage as quickly as possible.
He said the full economic impact of the earthquake cannot be fully assessed yet.
In the short term, he said, domestic demand may dip due to reduced consumer spending on certain goods and increased working from home. However, he does not anticipate any medium- or long-term impact, expecting confidence to eventually recover.
In the real estate sector, particularly for high-rise buildings, he noted that there may be a psychological impact from the earthquake that could reduce confidence in purchasing condominiums.
However, overall, it is believed that there may be a shift in demand towards low-rise housing instead, he said.
