Despite improvement from the first quarter, sentiment among housing developers in Greater Bangkok in the second quarter remained low as inflation, higher interest rates and rising costs worried them.
According to the Real Estate Information Center (REIC), the sentiment index of housing developers in the second quarter rose to 49.8 from 47.1 in the first quarter and 46.4 in the same period last year.
"The improved sentiment was attributed to relaxed Covid-19 measures and the removal of the Test & Go scheme for foreign arrivals on May 1," said Vichai Viratkapan, the centre's acting director-general.
With more tourists arriving since full reopening on June 1, residential developers have more confidence in the property market, he said.
However, the index remained below 50, which means they were not confident because of several negative factors.
Soaring fuel prices, rising costs of construction materials, in particular steel, inflation and interest rate hikes were the main concerns.
Their concerns were reflected in sentiment on development costs, which significantly dropped to 23.6 from 32.
There were five other measures gauged in the second quarter: performance, sales, investment, employment, and launches of new phases or new projects.
The highest level of confidence, posting the second-largest jump, was investment with an index of 59.4, up from 52.8.
The largest increase was sentiment on launches of new phases or projects, with an index of 55.7, up from 45.1.
The sentiment of listed developers in the second quarter remained higher than the feeling of non-listed firms, with indices of 54.9 and 42.2, respectively, which rose from 51.1 and 41.1 in the first quarter.
The expectations index of both listed and non-listed developers, which reflects sentiment for the next six months, was 56.6 in the second quarter, slightly up from 56.5 in the first quarter.
The expectations of listed and non-listed firms moved in the opposite direction.
Listed firms' expectations rose to 61.6 from 60.5, while the index of non-listed firms dropped to 49.1 from 50.5.
"Listed developers were more confident in new project launches and employment in particular, while non-listed firms had low confidence in sales," said Mr Vichai.