FSS International Investment Advisory Securities (FSSIA) noted in its analysis that, on Tuesday, real estate developers in Thailand are closely observing announcements regarding government initiatives related to potential stimulus measures for the property sector. This includes a proposed 2% reduction in land transfer fees and a modification of mortgage fees from 1% to 0.01% for residential properties valued at up to THB 7 million.
The analyst expected these measures to pose a positive sentiment in the short term, aiding the stability of the Thai stock market. However, the positive impact is likely to be limited due to constraints on new purchases from buyers stemming from buying power, household debt burdens, and high rejection rates.
Meanwhile, the measures will stimulate activities for residence buyers already awaiting property transfers, facilitating smoother backlog recognition for developers.
Additionally, another measure that developers are more hopeful for is the relaxation of Loan-to-Value (LTV) regulations, which are expected to have a more significant impact on the market, though it still awaits consideration by the Bank of Thailand (BOT).
FSSIA upholds a ‘Neutral’ recommendation for the Thai property sector, as the market outlook remains challenging. AP is selected as the top-pick stock for the analyst due to its strength in market positioning, product portfolio, and financial standing.
