BOT prepares draft to extend Thailand's housing LTV easing by one year
The temporary measure would run from Wednesday (July 1, 2026) to Wednesday (June 30, 2027), with the property market still slowing and unsold supply high.
- The Bank of Thailand (BOT) has drafted a proposal to extend the temporary easing of housing loan-to-value (LTV) rules for an additional year.
- The proposed extension would be effective from July 1, 2026, to June 30, 2027.
- This measure is a response to a slowing property market, high levels of unsold housing, and geopolitical risks impacting the sector.
- The extension aims to support the real estate sector by maintaining the LTV ceiling at 100% for certain loan contracts, making it easier for people to borrow for housing.
A source at the Bank of Thailand (BOT) said the central bank has drawn up draft rules to temporarily ease the supervisory criteria for housing loans and other loans linked to housing loans by financial institutions and specialised financial institutions, or the new loan-to-value (LTV) criteria.
The aim is to extend the existing measure by another year from Wednesday (July 1, 2026) to Wednesday (June 30, 2027).
Rationale for easing LTV rules
The BOT said the rationale was that the property market continues to slow, and unsold supply remains high.
At the same time, the real estate sector still faces geopolitical risks from the war in the Middle East, affecting demand for housing purchases, construction costs, and household and business confidence.
These would add pressure, or a shock, that could cause the sector to contract sharply and make its recovery more difficult.
The BOT therefore deemed it appropriate to issue a notification on the temporary relaxation of supervisory criteria for housing loans and other loans linked to housing loans by financial institutions and specialised financial institutions, or the LTV criteria, for another year from Wednesday (July 1, 2026) to Wednesday (June 30, 2027).
Supporting the property sector against a shock
This move is intended to help support the real estate sector, whose supply chain is linked to various parts of the economy and to substantial employment, by easing the problem of unsold supply.
The latest relaxation is not expected to add much risk to financial system stability, as financial conditions remain tight, financial institutions and specialised financial institutions are cautious in lending, and no sign of speculation in the real estate sector has yet been found.
At the same time, the current relaxation of LTV rules is due to end on Tuesday (June 30, 2026), and this notification would set the LTV ceiling at the same level as the ceiling under the currently relaxed LTV rules.
The BOT also considered that the rules should be set quickly to prepare for risks or shocks ahead from unrest in the Middle East that could affect the real estate sector and spill over into the real economy.
The move would also help protect the public's interests by making it easier for people to borrow to buy housing as needed through loans with a maximum credit line based on collateral value, while ensuring continuity and maintaining confidence among households and businesses.
The BOT has previously held discussions with directly affected parties, including listed and unlisted property developers, the Housing Business Association, the Thai Real Estate Association, the Thai Condominium Association and the Housing Loan Club, which comprises members from commercial banks and specialised financial institutions, to hear their views and assess potential impacts.
Key points of LTV easing
The key points of the latest LTV relaxation rules begin with setting the loan-to-value ratio ceiling at 100% for housing loans in both cases: (1) collateral value below THB10 million, from the second loan contract onwards; and (2) collateral value of THB10 million or more, from the first loan contract onwards.
The relaxation is temporary and applies to loan contracts signed from Wednesday (July 1, 2026) to Wednesday (June 30, 2027).
