Tuesday, July 07, 2020

Developers launch resale campaigns after homebuyers stranded by LTV curbs

Sep 23. 2019
Ashton by Ananda Development
Ashton by Ananda Development
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By Somluck Srimalee
The Nation

For homebuyers looking for lucrative deals, this might be the time to invest when many property firms are launching special promotion campaigns to sell residential projects that could not be transferred to previous customers who could not get loans due to the new loan-to-value (LTV) regulations.

According to a Nation survey, a number of property firms have launched campaigns to resell residential projects that had already been sold to customers who had to back out because they could not get loan approval from commercial banks.  

For example, Ananda Development Plc launched its latest campaign to sell condominium units priced at between Bt1.29 million and Bt25.9 million per unit, most of which had already been sold. However, the original customers could not go ahead with the transaction as they could not get loans so the company has had to launch a fresh resale campaign. The campaign offers customers 100 per cent loan from commercial banks.

Ananda Development Plc has put residential property worth Bt15 billion, which the both resale and inventories, for sale under this campaign.

The Park Land Charan-Pinklow also offers condominium units for resale after the previous buyers pulled out. The company is offering free transfer fee and buyers will get 100 per cent of loan-to-residential value. The residence offers a starting price of Bt2.27 million per unit.

“After the LTV measure came into effect, up to 20 per cent of our customers’ loan applications were rejected by commercial banks. We have to resell the units that could not be transferred to customers again,” Sena Development Plc’s deputy chief executive officer, Kessara Thanyalakpark, said recently.

The Bank of Thailand tightened mortgage regulations this year after it found signs of vulnerability to bad loans in the property sector.  

A source from property firm said that the resale units will offer a price lower than the market price as the property firm had got the down payment from existing customers. This is the reason the resale units are priced lower than the new units, the source explained.

“Property firms have to launch their campaigns to speed up their sales in the rest of this year when the property market has continued to drop,” the source said.

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