The Greater Bangkok housing market fell by 13% in the first half after the Bank of Thailand's new loan-to-value (LTV) limits took effect on April 1, according to SET-listed developer Pruksa Holding (PSH).
The total market value in the first six months was down to 201 billion baht from 232 billion in the same period last year. All housing categories dropped, with condos seeing the largest decline.
Condo market value in the first half totalled 104 billion baht, down 17% from 125 billion baht in the same period last year. Single detached houses declined by 12% to 51.5 billion baht from 58.3 billion baht, while townhouses were down 5% at 41.2 billion baht.
In the second quarter, the market shrank by 8% to 99.8 billion baht. The decline in second-quarter market value followed a first quarter that saw a decrease of 18.7% to 101 billion baht from 123.6 billion baht a year earlier.
By unit, the housing market in the first half fell 11% to 51,865 units from 58,008 in the same period last year. The second quarter saw a decrease of 14% to 23,500 from 27,392 units in the same period of 2018, and by 17% from 28,365 units in the first quarter.
Single detached houses saw the largest decrease in unit number in the first half, with a drop of 15% to 7,682 units, followed by townhouses, which fell by 11% to 14,179 units, and condos, dipping 9% to 29,367 units.
As of the end of the second quarter this year, housing inventory in Greater Bangkok was up 16% from the same period last year. Condos saw the largest increase with 28%, followed by townhouses (11%) and single detached houses (4%).
Deputy group chief executive Supattra Paopiamsap pointed to a raft of negative factors in the second quarter, including the global economic slump, the country's sluggish tourism, the stronger baht, drought, high household debt and the new lending curbs.
"The new government should use measures to stimulate the property market, which can help boost the economy," she said. "Without property incentives, small developers or those without strong financial backup will be gone."
Mrs Supattra did not ask for a revocation of the LTV limits, but rather asked for other measures to drive the housing sector and relax the lending rules, particularly for co-borrowers who want to buy their own units.
"They should be allowed to split from main borrowers when main borrowers have paid for a mortgage loan within a certain period," she said. "Debt evaluation for co-borrowers should be done on the date they will transfer a unit."
Mrs Supattra said home loan rules should be relaxed because only one-third of household debt in Thailand is from housing mortgages, compared with two-thirds overseas.
Due largely to a residential market slowdown in the second quarter, Pruksa revised down the number of new projects launched to 40 projects worth 47.4 billion baht from 55 worth 68.1 billion planned earlier.
PSH shares closed yesterday on the Stock Exchange of Thailand at 20.50 baht, down 1.40 baht, in trade worth 126 million baht.