The property market in northeastern provinces has stirred to life after lockdown restrictions were eased, but mortgage rejections remain a problem, according to local developers.
Narathorn Taninpitak, president of the Nakhon Ratchasima Real Estate Association, said although the market after the lockdown has resumed, with rising numbers of customers visiting sites thanks to campaigns and discounts, banks' conditions for mortgages are still a major concern.
"To boost the market, the property tax incentives should extend from the current maximum of 3 million baht to 10 million baht," said Pheraya Ruksujarit, managing director of The Spring Place, a large developer in Khon Kaen.
"The lending curbs should also be revoked."
She said the number of customers visiting the project's site were meagre during the outbreak because they were not confident.
Channarong Buristrakul, honorary president of the Khon Kaen Real Estate Association, said many developers in the province quickly adjusted by reducing launches.
"Poor sentiment starting a few years ago saw the vast majority of developers stop launching new projects last year," he said.
Mr Channarong said weaker demand was not a serious concern as supply in the market is not as high compared with 2011, when there was nationwide flooding and Bangkok-based developers jumped to provincial markets and created an influx of new projects.
"During that time, land costs soared, exceeding local purchasing power," he said.
Mr Channarong said the northeastern property market will gradually pick up as there will be a number of natives born there that will return to their hometowns as they reach retirement age.
Life in the provinces has become more convenient with services such as food delivery, he said.
Pol Lt Col Varayupas Treewattanasuwan, president of the Udon Thani Real Estate Association, said more customers visited project sites in the province recently, most of them returning from Bangkok after the lockdown.
Vichai Viratkapan, acting director-general of the Real Estate Information Center (REIC), said the residential market in the Northeast will continue to slow as a sluggish economy and the pandemic dampen homebuyer confidence.
"Developers in large provinces should be more cautious of launching new supply," Mr Vichai said.
"They should monitor the market situation and absorption rate, studying locations and pricing segments."
According to the REIC, five major provinces in the Northeast will see a further sharp drop in the monthly absorption rate of residential units in 2020.
All housing types in Nakhon Ratchasima, Khon Kaen, Udon Thani, Ubon Ratchathani and Maha Sarakham will have a monthly absorption rate of 0.4-1.3% this year, compared with 0.9-2.7% in 2019, said REIC.
New residential supply being launched in those provinces this year will decline 41-53% from 2019, except for Maha Sarakham, which will rise to 88 units from 64 units.