Thailand’s capital market continued to slow down over the course of 2019. To promote investment, the Bank of Thailand cut the policy rate for the second time this year in November from 1.50% in August 2019 to 1.25%.
The residential market has continued to weaken despite the government’s measure of reducing both transfer and mortgage fees to 0.01% from 2% and 1%, respectively. However, the new rate only applies to first-owned residential property priced below THB 3 million. The Bank of Thailand has stated that they will reevaluate the recently amended LTV regulations after the implementation in April 2019.
Land acquisition remained limited in Q4 2019 as developers focused more on clearing their unsold inventory rather than acquiring land for new projects. There were two major land acquisitions this quarter. A 20-rai (3.2 hectares or 7.9 acres) site was acquired by LPN Development for condominium development in the Bang Khun Thian area with a total value of THB 362 million. The other was a land acquisition by Bumrungrad Hospital PCL of a 2-rai site (0.32 hectare or 0.4 acre) in Nana (Sukhumvit Soi 3) with a total price of THB 930 million which was equivalent to THB 1.09 million per square wah.