Residential market surges in Q1 on back of stimulus package

“Our presales in the first quarter came in at Bt9.36 billion, up 4 per cent from our earlier estimate of Bt9 billion, thanks to both the cut in transfer and mortgage fees to 0.1 per cent and the latest financial package for homes priced at no more than Bt1.5 million per unit under the ‘Baan Pracha Rath’ campaign,” said Lersuk Chuladesa, chief operating officer of Pruksa Real Estate.
The developer has 4,359 units worth Bt4.77 billion in this price category that are ready for sale and transfer to customers, he said.
“We believe this campaign will drive our first-half sales strongly – above our earlier estimate for the period,” he added.
LPN Development, meanwhile, transferred homes worth around Bt4 billion to its customers in the first quarter, more than double the Bt1.9 billion achieved in the same period last year.
This was due in large part to the government’s measure reducing mortgage registration and transfer fees, managing director Opas Sripayak said.
The company also has ready-to-stay condominium units worth up to Bt5 billion that fall in the below-Bt1.5 million per unit category and will benefit from the “Baan Pracha Rath” campaign.
This will drive LPN’s presales and transfers above its estimates at the start of the year, he said.
Golden Land Residence – a subsidiary of Golden Land Property Development – recorded presales worth Bt3.1 billion in the first two months of the year, putting the company well on track to exceed its presales target of Bt3.5 billion for the first quarter.
“We believe presales will grow beyond our estimate thanks to strong residential demand among home-buyers, and especially among those speeding up their decision to purchase before the measure to cut transfer and mortgage fees to 0.1 per cent expires on April 28,” managing director Saenphin Sukhee said.
Supalai recorded presales worth Bt3.13 billion in the first two months of the year, some 27 per cent higher than in the same period last year.
The developer now estimates its first-quarter presales will come in at Bt5 billion.
“Residential demand started to recover during the final quarter of last year, when the government’s measure to cut the mortgage and transfer fees came into effect. This drove increased demand to buy detached housing and townhouses in the final quarter of 2015 and the first quarter of this year,” Supalai managing director Tritecha Tangmathithum said.

Sale value soars
The company’s sales value has increased by an average of Bt1 billion a month to Bt1.7 billion due to the effectiveness of the government’s fees measure, he added.
NC Housing, meanwhile, recorded presales of Bt600 million in the first quarter, some 20 per cent higher than in the same period last year, thanks to the government’s stimulus package for the property sector, deputy managing director Sumnuek Tanthathoedtham said.
According to a survey by the Government Housing Bank’s Real Estate Information Centre of residential inventory priced up to Bt1.5 million apiece, there are around 36,100 units available nationwide, 20,300 of which are located in Bangkok and its suburbs.
“The ‘Baan Pracha Rath’ campaign will help property firms reduce their inventory. It helped drive the market to strong growth in the first quarter, and will continue to do so in the second,” said the centre’s director-general, Samma Kitsin.