LH Chief States Slowdown Is Unavoidable
Thailand's property market is just going to slow down, regardless of a downward drift in construction costs, oil prices and interest rates, as consumer confidence is receding, says Anant, the chief of Land & Houses Plc, the country's major residential developer. He said the global economic crisis had increased concern among lenders, even healthy ones, and mortgage refusal rates would climb accordingly.
The credit crunch will also decrease demand by foreign consumers. Investments by foreign funds would vanish as investors need liquidity, he said.
In addition, he said, a few developers would find it hard to develop business by drumming property funds, warrant issues or project finance, thus only large developers would stay in the market.
''No one has said they would spread out investment in 2009,'' Mr Anant said. As a consequence, supply of fresh developments will be concentrated, the same as will be the number of lively developers.
Mr Anant said the country's financial system required to be inspired through more government investment, at the same time as the private sector should carry on investing if achievable. Most significantly, he said, the Bank of Thailand should not be concerned about price hike and should decrease interest rates so as to motivate investment.
Everybody says the country's economic essentials are excellent although we should look forward. What will come about subsequently?''
Mr Anant said the country had suffered approximately four years of political improbability and tension that had damaged the financial system. ''We have paid too much consideration to politics and every sector apparently has become of poorer quality.''
He anticipates no scrupulous show up segments in the property market in 2009. The condominium market has detonated in current years as high oil costs encouraged consumers to look for homes nearer to their workplaces in the city, however with oil prices falling quickly, condo sales could cool.
Though, Mr Anant considers that luxury property priced at 20 million baht or more would not be affected as wealthy consumers had cash and savings.
The credit crunch will also decrease demand by foreign consumers. Investments by foreign funds would vanish as investors need liquidity, he said.
In addition, he said, a few developers would find it hard to develop business by drumming property funds, warrant issues or project finance, thus only large developers would stay in the market.
''No one has said they would spread out investment in 2009,'' Mr Anant said. As a consequence, supply of fresh developments will be concentrated, the same as will be the number of lively developers.
Mr Anant said the country's financial system required to be inspired through more government investment, at the same time as the private sector should carry on investing if achievable. Most significantly, he said, the Bank of Thailand should not be concerned about price hike and should decrease interest rates so as to motivate investment.
Everybody says the country's economic essentials are excellent although we should look forward. What will come about subsequently?''
Mr Anant said the country had suffered approximately four years of political improbability and tension that had damaged the financial system. ''We have paid too much consideration to politics and every sector apparently has become of poorer quality.''
He anticipates no scrupulous show up segments in the property market in 2009. The condominium market has detonated in current years as high oil costs encouraged consumers to look for homes nearer to their workplaces in the city, however with oil prices falling quickly, condo sales could cool.
Though, Mr Anant considers that luxury property priced at 20 million baht or more would not be affected as wealthy consumers had cash and savings.
Labels: Construction costs, property funds, property market, residential developers
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