Chatchai Payuhanaveechai, Kasikorn Bank’s executive vice president said that property market of Thailand continues to remain secure and has not indicated any symptom of bubble or oversupply.
He said that 102,000 housing units were constructed last year which showed 19 percent growth, and at the same time on the sale side 107,000 were sold, a thirty percent growth.
129,000 units remained unsold last year. The figure witnessed 4% decrease from that of 2011. Almost 130,000 units remained unsold from 2009-11.
The cause of higher housing prices, he said, was surging costs at 12%. The surging costs had been witnessed since second quarter of last year. Price of individual houses showed an increase of 3%, townhouses saw 2% and condominium price 6%.
Behind the escalation of housing prices is growing labor and land costs in Bangkok and its outskirts especially near the Skytrain.
There was a decrease in non-performing loans for houses that were below Bt5 million from 2.4 in 2011 to 2.3 in 2012.
Almost thirty percent of the houses having prices less than Bt5 million are purchased with cash, while other 70 percent with loans. As far as the houses above Bt5 million are concerned, there ratio of cash to loan purchases are same.
He expected a growth of property market of the country in this year with total loans at Bt2.45 trillion, an 8.5 percent boost comparing to previous year, and personal non-performing loans expected to be Bt280 billion in current year, an 11 percent increase.
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