Phuket Property: Central bank fears bubble
PHUKET: The Bank of Thailand (BoT) might reel in the real estate market after detecting some hot spots, especially in the condominium segment for units priced under 3 million baht.
“A restriction on banks for 0% interest rates is one of the measures to control the market. But the central bank will have other measures such as tightening the loan-to-value ratio from 90% for condominiums to 85 or 80% if it believes that the condo market shows signs of speculation and may form a bubble in the near future,” a source said yesterday.
A team has been sent to meet with the top 10 listed property firms to ask them about the residential market, he said.
The main question concerns the supply and demand situation, as concern grows over indicators of a glut in the market. But most developers believe that the market still has demand to absorb the supply and that the market is still stable without any bubbles.
They admit that some locations may be subject to speculation, but say that does not change the overall property market.
The central bank may not impose any measures on the public but will use internal guidance such as asking banks to rein in lending. They may be asked to report project loans over 200 million baht, or to raise the credit score threshold for approving mortgage loans. These are some ways to control the property market without creating any panic.
In 2011, buyers of condos were required to make a down payment of 10% of a unit’s value and in 2012 buyers of low-rise residences, both townhouses and single family homes, had to deposit just 5%.
Prasert Taedullayasatit, chief business officer of Pruksa Real Estate Plc, said he would meet with the BoT on Friday. It was normal, he said, that the authorities will need more information from developers about market sentiment and the size of both supply and demand. This is better for the BoT before launching more measures to control the market.
Srettha Thavisin, president of Sansiri Plc, said he met with the BoT team last week and gave them market data, including the sizes of both supply and demand. The company also showed the team its market research studies. When the company goes into new locations it has to have the information to support its expansion plan.
“They asked if a drop in the loan-to-value ratio to 85% or 80% would impact the market. I said that it would impact directly on buyers of residences priced lower than 2mn baht because they do not have enough savings to make a down payment. This will not support low-income people in owning a home,” he said.
“In my view the property sector does not have a bubble ,” he said.
For example, Sansiri now limits sales to its customers. If they want to buy more than five units, the company will not sell them to them. This is one of the measures to reduce speculators in the market, he said.
Chatchai Payuhanaveechai, executive vice president of Kasikornbank, said that if the BoT does not want banks to offer a zero interest rate to customers, then K-Bank will follow that policy, because it is the responsibility of the central bank to manage the country’s risk.
“However, we believe that the property market now is different from 1997 because most property firms and commercial banks have restraints on launches and provide loans for customers based on credit scores.
“When we look in more detail we see fewer non-performing loans among mortgage loans than among other loans, so we believe that the real estate market now does not face a bubble. But we have to be careful in some locations,” he said.
The BoT will also talk with banks about their campaigns for home loans featuring a 0% interest rate as part of its annual visit to the executives of the banks.
Ruchukorn Siriyodhin, assistant governor for the Financial Institutions Policy Group, said banks can launch this kind of zero-rate campaign but they have to clearly inform prospective customers about the effective interest rates throughout the loan term to give them complete information for decision-making.
The central bank has been monitoring the banking industry and found that their lending has met the standards, and that their non-performing loans (NPLs) have not increased. Bankers said they have been informing home loan customers about the effective rates after the 0% rate ends. The central bank raised this concern to prod the banks into being more cautious about bubbles in the property sector, they said.
— The Nation
Thailand Property FAQ
Can foreigners buy property in Thailand?
Yes. Foreigners can own condominium units freehold, as long as foreign buyers hold no more than 49% of the building's saleable area. Land cannot be owned directly by foreigners; houses are usually held through a 30-year lease — and since a March 2025 Supreme Court ruling, automatic “30+30+30” renewal structures are not enforceable beyond the first 30 years. Read the full foreign-ownership guide.
What is Thailand's 49% foreign quota?
In any condominium project, no more than 49% of the total saleable floor area can be foreign-owned. The quota applies only to condos — not houses, land or leaseholds — and popular buildings in Bangkok, Phuket and Pattaya can hit the cap. How the quota works in practice.
How much are property transfer fees in 2026?
The transfer registration fee is cut to 0.01% (from the standard 2%) and the mortgage registration fee to 0.01% (from 1%) for purchases where both the price and assessed value are 7 million baht or less — extended by the Cabinet on June 30, 2026. On a 6-million-baht home that saves around 120,000 baht. Who qualifies for the cut · Standard fees & who pays what.
Is it better to rent or buy in Thailand as an expat?
It mostly depends on your time horizon: for stays under roughly five years renting usually wins once transfer costs and resale friction are counted, while longer stays can favour buying — especially with 2026's reduced fees. The rent-vs-buy maths for expats.
How much does property cost in Thailand?
A little over 2 million baht buys a freehold one-bedroom condo in central Chiang Mai — the same budget covers only a studio in Bangkok's CBD. Prices vary sharply by region and city. Average prices by region, and what they buy you.
What taxes do property owners pay in Thailand?
Owners pay the annual land and building tax, and rental income is taxable; buyers and sellers split one-off costs like transfer fees, stamp duty or specific business tax depending on the deal. The go-to guide to Thai property taxes.
