Sentiment among housing developers is expected to significantly improve in the second quarter following the implementation of property stimulus measures approved earlier this month.
The current situation index for housing developer sentiment in Greater Bangkok in the first quarter is at 48.3, lower than the median of 50.0 for five consecutive quarters, according to the Real Estate Information Center (REIC).
"An index below the median indicates developers had reduced confidence and were worried about the outlook," said Vichai Viratkapan, acting director-general of the REIC.
However, the index is likely to improve in the second quarter as the property measures announced this month will have a positive impact on the residential market, he said.
One of the measures is a reduction in transfer and mortgage fees from 2% and 1%, respectively, to just 0.01% for both, limited to residential units priced at 7 million baht or cheaper.
A previous scheme included a similar measure for residential units priced at 3 million baht or cheaper.
"The property measures will be a significant factor in boosting confidence across all aspects for businesses in the remaining three quarters of 2024, including investment, development of new projects, sales and overall business performance," Mr Vichai said.
According to the REIC, developers in the first quarter remained concerned about investment, sales, performance and development cost, all of which were below 50 on the index.
However, developers remained confident in new launches and employment.
The index for new launches rose to 59.0 from 55.5 in the fourth quarter of 2023, while the index for employment tallied 52.4, up from 50.7 in the same period.
The sentiment index for listed developers was 52.5, up from 48.1 in the previous quarter, while the sentiment index for non-listed firms fell to 41.9 from 46.8.
Listed developers expressed greater confidence in new launches, investment, employment and sales. However, they were less confident about development costs.
The expectations index fell to 57.3 from 60.0 in the fourth quarter of 2023, though this is still higher than the median. This suggests developers maintained a positive view of the market for the next six months, he said.
Confidence in new launches increased, but fell for other factors, namely sales, employment and development costs. Among these factors, the expectations index for development costs was the lowest at 34.4, largely attributed to rising oil prices.