KBank lowers mortgage target amid debt, costs
Play
CONCERNS over high household debt and the rising cost of living have sapped the purchasing power of homebuyers, so Kasikornbank has had to downgrade its mortgage target.
Chatchai Payuhanaveechai, executive vice president of KBank, said yesterday that new home loans at the bank are expected to reach Bt47 billion this year, lower than the forecast of Bt49 billion, because consumers are worried about their future income.
Outstanding housing loans of commercial banks are expected to grow by 6-8 per cent to Bt2.7 trillion this year, but improve by 8.5 per cent to Bt2.9 trillion next year, as the residential market benefits from the mass transit projects in Greater Bangkok.
Kasikorn Research Centre has found that homebuyers are more cautious about borrowing as they are nervous about the uptrend in interest rates.
The worry over mortgage interest rates increased to 20.8 per cent after the coup from 16.7 per cent before the coup. The worry over the cost of living also edged up to 19.5 per cent from 18 per cent.
Household debt is ballooning to 85 per cent of gross domestic product this year. This will make loan approvals more difficult because consumers will face a financial burden of 30 per cent of their income, he added.
Pikun Srimahunt, first executive vice president of Siam Commercial Bank, said the bank’s new housing loans this year will meet the goal of Bt100 billion due to the larger transfer of condominium projects in the remaining months of this year.
However, outstanding mortgage loans at the bank are stable at Bt500 billion due to huge repayments.
