Bangkok condo sales slow, trend likely to continue

The American firm said on Friday that that despite developers recently increasing condominium launches in the capital sales to Thai buyers had slowed in some locations and were likely to slow further with the coming imposition of tighter mortgage lending criteria.
“Some developers are trying to find locations where there is real demand from Thai end-users [buyers] and develop projects that buyers can afford,” the company said.
“Others have increased their reliance on foreign sales where there is uncertainty as to who will be the final occupier. The downtown expatriate rental market is stable but CBRE thinks the market in the midtown/suburban areas is quite flat, so buy-to-rent investors may not achieve the yields they were expecting.”
CBRE added that the Bank of Thailand hadrecently imposed tighter regulations on mortgage lending by reducing loan to values (LTV) for certain categories of purchasers in an effort to curb mortgage and property market risks and improve the quality of housing loans.
“Effective from April 1, 2019, these new measures will favour first-home buyers with genuine demand as opposed to buy-to-rent investors with multiple outstanding mortgages, who are searching for yield,” CBRE added.
Although the new mortgage regulations will not force developers to collect minimum down-payments at contract signing, it will encourage them to demand more at the outset to reduce the risk of loan defaults upon transfer. 
This will reduce the demand from speculative buyers since the new rules will require buyers to pay 20-30 per cent of the purchase price up front, double today's 10-15 per cent.