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Thailand's central bank is evaluating measures to support the property sector as developers struggle with falling demand and stricter lending. Industry players have urged the Bank of Thailand (BoT) to ease loan-to-value (LTV) rules to boost home sales. While the LTV ratio currently stands at 90%-100% for first-time buyers, rising bad loans and sluggish market conditions have reignited calls for policy adjustments. Finance Minister Pichai Chunhavajira has pushed for a review, citing weak consumer confidence. Any changes in lending policies could impact property prices, investment sentiment, and the overall housing market.
Thailand's central bank is considering steps to support the property sector as developers face declining demand and stricter bank lending. The move follows calls from industry players seeking relaxed loan-to-value (LTV) rules to ease financial strain on homebuyers and stimulate sales. Advertisement
Property developers have urged the Bank of Thailand (BoT) to revise current policies that limit the percentage of a property's value that can be financed through loans. Assistant Governor Suwannee Jatsadasak acknowledged these concerns, stating that the central bank is assessing possible measures to provide relief. Currently, the LTV ratio stands at 90% to 100% for first-time residential buyers, a level the central bank previously deemed appropriate. However, rising bad loans and a sluggish market have renewed discussions about potential policy adjustments.
Finance Minister Pichai Chunhavajira has highlighted the urgency of supporting the real estate sector, citing weak consumer confidence and growing loan defaults. His push for a review of LTV regulations suggests that easing borrowing conditions could help sustain the sector's recovery. Developers argue that limited access to financing has deterred potential buyers, further slowing property transactions.
The Thai property market has faced multiple challenges, including high household debt and economic uncertainty. With banks tightening lending due to concerns over bad loans, developers are finding it harder to secure funding for new projects. Any policy changes by the central bank could significantly impact real estate activity, affecting both developers and prospective homebuyers.
Market observers are closely watching the central bank's next move, as any relaxation in lending rules could influence property prices and investment sentiment. While BoT has yet to confirm specific policy changes, its willingness to engage with industry stakeholders signals a potential shift in approach to reviving the struggling housing market.
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