The government should help home buyers to get mortgage loans more easily as tough loan approval criteria are obstructing housing demand despite strong purchasing power, Anant Asavabhokhin, chairman of SET-listed developer Land & Houses Plc, said on Thursday.
“Purchasing power is strong,” he said. “If there are to be any measures by the government to boost the property market, it should be to help home buyers get mortage loan approvals as rejection rates remain high.”
Peerapong Jaroon-ek, chief executive of SET-listed developer Origin Property Plc said banks should classify home buyers and market segments when applying strict lending rules.
“Banks should not apply stricter lending rules for all customers, or the whole segment, as not everyone has a problem of financial discipline,” he said.
Mr Anant said the property market in the first four months of this year grew as it was driven by property tax incentives which ended in late April. The market slowed in May and will likely do so in June, while it was unpredictable for the whole year.
“Many developers now offer home buyers very attractive campaigns and discounts which are better than what home buyers got from the property tax incentives, as the developers can see signs of a market slowdown in May and June after the incentives ended.”
Amid a cloudy property market outlook, large developers will be able to sustain their businesses, but it might be more difficult for small and medium-sized developers. For SME developers, market surveys and research are a must to survive, said Mr Peerapong.
“Small-and medium-sized developers should apply a customer-centric approach. They should study demand as land prices today are so high that just any property development is not feasible,” he added.
Kwanchai Yingcharoenthawornchai, managing director of new property developer Alternative Asset Plc, said property investment for individual investors would change this year as the market had changed.
“In the past four years, speculation and short-term investment was very good. Many speculators could make a profit from selling a presale condo during a downpayment period. But this year it will be not that good due to the sluggish economy,” he said.
He added investment in condos for rent in the inner city was also sluggish as rents were not rising. In some locations where yield had been as high as 8%, it had dropped to only 3-4%.
Mr Anant said Land & Houses this year would invest in more recurring income including shopping mall and hotel. It will develop Terminal 21 malls in Pattaya and Nakhon Ratchasima and was looking for new plots of land of around 20 rai to develop shopping malls in Bangkok suburbs.
"In the previous decade, our subsidiaries contributed revenue of 100 million baht a year. Now that amount has soared to three billion baht," he said. "Without them, LH might struggle amid the property market slowdown."