SOMLUCK SRIMALEE

THE NATION

PROPERTY FIRMS ARE GOING ALL OUT FOR HOMEBUYERS AHEAD OF BOT'S  MEASURES TO REIN IN MORTGAGE LOAN APPROVALS

PROPERTY DEVELOPERS are stepping up their launch schedules in the final quarter of the year with a slew of residential projects worth Bt187.71 billion, ahead of the Bank of Thailand's (BOT) expected measures to rein in mortgage loan approvals by commercial banks, according to a survey by The Nation.

Amid high confidence across the industry, Pruksa Real Estate Plc plans to launch up to 42 projects nationwide in the quarter comprising condominium, single-detached house, townhouse, and twinhouse developments with market value of Bt41.5 billion.

AP (Thailand) Plc is poised to introduce 18 residential developments worth a total of Bt31.23 billion while Supalai Plc Plc gears up for the launches of up to 18 new projects costing a total of Bt20 billion before yearend. (See graphics)

A survey by Collier International (Thailand) Co Ltd finds listed and nonlisted property firms planned to launch 102 projects, offering 23,917 units at a combined cost of Bt138.8 billion, in Bangkok and its suburban areas. Of the total, up to 70 projects worth Bt55 billion are single detached house, townhouse, and twinhouse developments, offering a total of 7,500 residential units. Condominiums make up the balance of 32 projects, supplying a total of 16,417 units worth Bt83.8 billion.

"We are confident of homebuyers'demand in the final quarter, from both local and foreigner clients. We have revised up the year's pre-sale target to Bt50 billion from Bt45 billion after posting Bt41.5 billion for the first nine months," said Sansiri Plc's chief financial officer Wanchak Buranasiri, adding that foreign buyers accounted for Bt12 billion of the total.

Hence, the company will launch seven residential developments towards the end of the year, comprising three condominium, three townhouse and one single detached house projects worth a total of Bt12.7 billion, he said.

Chanond Ruangkritya, chief executive officer of Ananda Development Plc, cited government investments in infrastructure projects, construction of mass transit networks in particular,as a driving factor for the realty market.

He said the company will launch three residential properties, a condominium and two single detached house projects worth a total of Bt7.8 billion, in the final quarter.

In regards to the central bank's pol-icy to restrict mortgage loan approvals by lowering the loan to value ratio from 90 to 80 per cent, Golden Land Property Development Plc's (GOLD)executive managing director Saenphin Sukhee said it means a homebuyers will have to settle a downpayment equivalent to 20 per cent of the property's market value while the evaluation process on his/her ability to pay will include all existing debts relating to credit card spending, hire-purchases, and personal loans. It will have a direct impact on buyers of residential units under Bt5 million each.

"In view of the BOT measures, there will be increased supply in the middle and upper income markets as developers shift their focus to foreign buyers. The picture will be clearer next year," he said.

GOLD will launch 17 residential properties worth a total of Bt21.3 billion in the second half of the year including nine townhouse, four twinhouse and three single detached house projects, plus a single detached house development upcountry.

Siamese Asset Co Ltd's managing director Kajonsit Singsansern said the company is sure of demand for condominium units in the central business district (CBD) in Bangkok. It introduces 'the Collection', a Bt4.8 billion condominium project on SukhumvitAsoke early this month.

"The BOT measures will not have a direct impact on our projects which target real market demand," he said.

The central bank is seeking to rein in the mortgage market by reducing the debt-service ratio and loan-tovalue criteria for prospective borrowers. The move will hurt home sales priced below Bt3 million per unit,according to a source from a major property firm.

Currently, commercial banks set a debt-service ratio of between 33 per cent and 50 per cent, which means a homebuyer pays a monthly instalment at an average of between 33 per cent and 50 per cent of their monthly salary. The banks have also imposed loan-tovalue ratios of about 90 to 95 per cent, requiring homebuyers to make a down-payment of five to 10 per cent of the property's value.

Under the new policy, expected to be implemented next year, homebuyers making an average monthly income of Bt27,000 will be limited to residential units priced at a maximum of Bt1.5 million. They would need a monthly salary of more than Bt40,000 to buy a Bt1.5 million property, the source said.

"Following this model, property firms will have to shift their sales base from the middle and lower-income market to the middle and upperincome market. It will have an direct impact on the market." he said.

At present, up to 30 per cent of the demand in the lower-middle to lower-income market, involves residential units priced between Bt1.5 million to Bt3 million each. Properties with a starting price of Bt5 million, pitched at the uppermiddle and upper- income market, account for the rest.

If the central bank persists with the implementation of the new regime next year, now is the last chance for prospective homebuyers to make a purchase, said another source in the industry.

Condominium launches hit ten-year high in third quarter

SOMLUCK SRIMALEE

THE NATION

THE NUMBER of condominium projects launched in Bangkok hit a ten-year high in the third quarter, offering 22,579 units from 46 developments worth a total of Bt107.54 billion, according to a survey by Collier International (Thailand) Co Ltd.

The figure represents a 20 per cent growth from the number of projects launched in the same period last year.

Up to 14 per cent are located alongside the existing mass transit routes in the inner city while 45 per cent of the total will be developed in areas close to the new mass transit network still under construction.

Prices of the new units range from Bt70,000 to Bt145,000 per square metre, the research said.

Meanwhile, the Real Estate Information Center (REIC) of Government Housing Bank reported transfers of 173,000 residential units in the first half, up 26 per cent from the same period last year.

Of the total,59,000 were handed over to buyers of condominium units and 114,000 to buyers of single detached houses, townhouses, and twinhouses. About 91,000 of the transferred units are located in Bangkok.

"Demand for residential units has been strong this year, mostly real demand from homebuyers," said Wichai Viratakaphan, REIC's acting director-general.

Most of the new condominium projects launched in the first half have reported presale rates of 70 to 80 per cent compared with 31.8 per cent for single-detached houses, according to REIC.