After the government approved measures to promote home ownership by reducing taxes for consumers purchasing their first home priced at no more than 5 million baht, buyers can benefit from a maximum tax deduction of 200,000 baht. This initiative aims to support the Thai economy during the mid-year period, as it has been observed that the overall economic outlook is slowing down. Consequently, property developers are actively launching unsold housing projects in hopes of stimulating purchasing power in this final stretch.

          Ms. Sukanya Suwannaphasri, Executive Director of Number One Housing Development Co., Ltd. revealed that the real estate market in 2019 has faced several vulnerabilities, particularly due to the Loan to Value (LTV) regulations imposed by the Bank of Thailand, which took effect on April 1, 2019. This has caused consumers, especially first-time homebuyers, to feel anxious and reconsider their financial planning. In addition to the house prices presented by property developers, there are numerous additional fees and expenses to consider, such as mortgage fees, transfer fees, stamp duty payable to the land department, mandatory fire insurance, and common area fees, among others.

          Meanwhile, a detailed analysis of government measures reveals that lower to middle-class consumers looking for their first property priced at no more than 10 million baht are not adversely affected by the LTV measures. Following the Cabinet meeting on April 30, there was good news as the Cabinet approved tax measures to support the Thai economy during mid-year by promoting home ownership for consumers purchasing properties, including buildings with land or condominiums valued at no more than 5 million baht, from the date of the Cabinet's approval until December 31, 2019. Buyers can claim a maximum annual tax deduction of 200,000 baht. Coupled with the maintained policy interest rate at 1.75% per annum by the Monetary Policy Committee (MPC), this results in low mortgage interest rates, marking a final opportunity for consumers wishing to own their homes before the MPC raises interest rates next year.

          Ms. Sukanya further stated that these factors are likely to lead to increased competition in the real estate market for properties priced under 5 million baht. Many property developers are likely to target the same demographic, focusing on lower to middle-class customers seeking their first home. For instance, Number One Housing Development has launched the iFeel Bangna townhome project, which consists of 2 to 4-story townhomes through the campaign "Choose What You Want" targeting consumers looking for 2 to 4-story townhomes with usable space comparable to single-family homes at townhome prices. The starting price is only 3.49 million baht, and with the prime location of iFeel Bangna adjacent to Bangna - Outer Ring Road (Kanchanaphisek), close to Mega Bangna shopping mall, it offers convenient transportation, making it a desirable location for consumers looking for homes to serve as home offices. Number One Housing Development is also providing additional discounts for this consumer group to facilitate ownership, and both townhomes and home offices can benefit from the government’s tax deduction of up to 200,000 baht.

          The iFeel Bangna project consists of ready-to-move-in townhomes and home offices, covering an area of 33 rai, 1 ngan, and 35 square wah, divided into three types: corner townhomes near the park with 2 stories, 3 bedrooms, 2 bathrooms, parking for 2 cars, usable space of 131 square meters on land of 29.30 – 34.20 square wah; followed by 3-story townhomes with 3 bedrooms, 3 bathrooms, parking for 2 cars, usable space of 194 square meters on land of 21.30 square wah; and 4-story home offices with 3 bedrooms, 4 bathrooms, and 50 parking spaces, with usable space of 230 – 260 square meters on land of 21.30 – 35.60 square wah. This location is ideal for those seeking residence in the Bangna area, offering convenience surrounded by complete public utilities, such as Ramkhamhaeng University 2 and Ramkhamhaeng 2 Demonstration School 4.6 km away, Number One Ram 2 Market 4.6 km away, Mega Bangna shopping mall 11 km away, and Suvarnabhumi Airport 11 km away.

 

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