Five signs Thailand’s property market faces a slow recovery into 2027

Thailand’s housing market is entering only a limited recovery as fragile purchasing power, high living costs, elevated property prices and strict lending standards continue to weigh on consumers, according to the SCB EIC Real Estate Survey 2026.

The survey shows that many prospective buyers remain reluctant to return to the market and are delaying decisions while they assess the economic outlook and their own financial position.

Although the market may receive short-term support from a low comparison base, accelerated transfers before the expiry of reduced transfer and mortgage-registration fees, and developers’ promotional campaigns, SCB EIC expects the market in 2026 to remain broadly flat or record only modest growth.

The medium-term recovery is also likely to remain slow.

1. More than half have no plans to buy within five years

The clearest sign of weak demand is that 56% of respondents said they had no plans to buy a home within the next five years.

The proportion increased from the previous year and was the highest recorded in the four years since the survey began.

The slowdown is not confined to lower-income households. The share of consumers earning more than 100,000 baht a month who are postponing purchases has also increased.

Among those who still plan to buy, more respondents expect to make a purchase within three to five years rather than this year, reflecting a wait-and-see approach towards both the economy and their own finances.

In the short term, the market is being supported by the low base and by buyers accelerating transfers before the transfer and mortgage-registration fees of 0.01% for homes priced at no more than 7 million baht expire.

The second-hand market is also expected to play a greater role. As a result, the 2026 market may avoid a sharp contraction, but the recovery is more likely to resemble stabilisation than a return to strong growth.

2. Tight credit becomes another barrier to home ownership

Even among consumers who want to buy, obtaining a mortgage is becoming an increasingly important constraint.

The survey found a slight increase in the proportion of respondents who were very or fairly concerned that their mortgage applications could be rejected.

Concerns were particularly high among those earning no more than 50,000 baht a month, many of whom are looking at homes priced at 5 million baht or below.

The trend is consistent with banks maintaining tight lending standards while outstanding non-performing housing loans remain elevated.

Most existing borrowers are still able to meet their repayments, but concern over their ability to continue doing so in the future has increased.

The key issue for the market is therefore shifting from whether people want to buy a home to whether those who want one can secure financing.

3. Demand shifts towards homes below 3 million baht

Another sign of fragile purchasing power is the downward shift in home-buying budgets.

Most demand remains concentrated below 5 million baht, but interest in homes priced at no more than 3 million baht has increased markedly, particularly among consumers earning no more than 30,000 baht a month.

This group also faces a relatively high risk of mortgage rejection.

The lower budgets do not simply reflect a preference for cheaper homes. They also show consumers adjusting their expectations to match weaker purchasing power amid an incomplete economic recovery and rising property prices.

Demand is also increasingly driven by genuine residential needs, particularly first-home purchases.

The share of buyers looking for second homes, investment properties or units for rental income has declined, suggesting that households are prioritising necessity over investment.

4. Second-hand homes gain ground as new properties stay expensive

Second-hand housing is attracting greater interest as new homes remain expensive and mortgage approvals become harder to secure.

The survey found that interest in second-hand homes increased from the previous year across all property types and price ranges, largely because they offer more affordable prices than newly built units.

Second-hand townhouses stand out in particular, especially in suburban locations that still offer convenient access to central Bangkok.

Their prices are generally more accessible than those of new townhouses in the same areas.

Supply is also expected to increase, especially for properties priced below 3 million baht, including condominiums and townhouses in Bangkok and surrounding provinces, as well as detached houses in other provinces.

Around one in three existing homeowners said they planned to sell their property within the next five years, with key reasons including reducing maintenance costs and switching into cash or other investments.

This means the second-hand market is likely to see both rising demand and increasing supply, potentially giving it a more important role in the next stage of the property-market recovery.

5. Renting remains necessary, but some tenants are moving home

Rental housing remains an important option for people unable to afford a home, although economic pressure is also affecting the rental market.

The proportion of people currently renting has declined slightly from the previous two years, mainly among tenants who do not yet own a home.

Some appear to have stopped renting and moved back in with their families to reduce expenses, while others have shifted from renting to buying as developers introduce promotions to clear unsold stock.

However, insufficient funds to purchase a home remains the main reason people rent, and the proportion citing this reason has edged higher compared with two years ago.

The issue is particularly pronounced among people earning no more than 30,000 baht a month, who account for more than half of current renters.

The rental market therefore presents two contrasting trends. It remains an essential option for people unable to access mortgages, but rising rents in some locations, particularly near central Bangkok and major transport routes, are putting greater pressure on household finances.

Some tenants may therefore move from inner Bangkok to outer districts or surrounding provinces where rents are lower in order to preserve household liquidity.

Property recovery in 2026-27 remains incomplete

Taken together, the five signals indicate that Thailand’s housing market is unlikely to recover strongly in the short term and will probably improve only gradually over the medium to long term.

SCB EIC said developers should formulate their strategies on the assumption that purchasing power will remain constrained.

New project launches should therefore be approached cautiously, particularly in highly competitive locations or areas with large numbers of unsold units.

Developers will also need to accelerate inventory management and focus more heavily on value for money as they compete with cheaper second-hand homes.

For consumers with genuine demand and sufficient repayment capacity, however, the short term may offer opportunities, particularly for homes priced below 7 million baht.

Supportive factors include the reduced transfer and mortgage-registration fees for qualifying properties, the relaxation of loan-to-value rules that is expected to remain in effect until at least mid-2027, relatively low interest rates and developer discounts.

Buyers should nevertheless consider the second-hand market, where high and potentially rising supply could provide more choice and help limit upward price pressure.

For those who want to buy but are not yet financially ready, renting or rent-to-own arrangements remain options for preserving liquidity and financial flexibility while economic uncertainty persists.

However, renters will need to monitor rising costs in high-demand locations and may increasingly have to consider outer Bangkok or surrounding provinces where rents are more affordable.

Source: Krungthep Turakij