Home Builders Association proposes to Prime Minister Prayut Chan-o-cha

Through three main issues aimed at resolving business challenges to assist those who genuinely wish to build their own homes

 

“Home Builders Association” participated in a workshop meeting at the invitation of General Prayut Chan-o-cha, the Prime Minister, and proposed three issues that the government should support to assist individuals wishing to build their own homes, categorized as Real Demand, through measures such as a 2% personal income tax reduction on home construction costs, not exceeding 100,000 baht over a period of five years, and exemption from land tax for up to 200 square wah per person. Additionally, they called for the registration of home builders to be formalized and for the government to promote and develop vocational education personnel while reducing business obstacles by reforming government agencies involved in construction permit applications for greater efficiency.

 

On September 3, 2020, General Prayut Chan-o-cha, the Prime Minister and Minister of Defense, held a workshop meeting with various business sectors under the initiative “Unite Thailand to Build the Nation,” which opened opportunities for all sectors and levels of society, including the “Home Builders Association” (HBA). This group is part of the real estate service sector invited to brainstorm ideas and methods to drive the business sector into the future. The meeting included Mr. Worawut Kanjanakul, President of the Home Builders Association, Ms. Patchara Tanyanyong, Honorary Committee Member, and Mr. Olan Janphu, Secretary-General of the Association, along with representatives from the Thai Real Estate Association and over 25 representatives from other real estate businesses.

 

 

 

Mr. Worawut Kanjanakul, President of the Home Builders Association (HBA), stated that during the meeting, the association presented various issues to the Prime Minister to address both short-term and long-term problems. The overall market for self-built homes has significant growth potential. According to data from the Real Estate Information Center, in 2019, there were 100,657 single-family homes permitted for construction nationwide (homes outside of housing projects), with a total value of 208.675 billion baht. Of these, 18,029 were newly registered single-family homes in Bangkok and its vicinity, which were self-built by citizens, marking a 3% increase from 2018.

 

 

Additionally, there are at least 120 million square meters of vacant land, with over 50% located in ten key districts suitable for self-building. Simultaneously, there are approximately 300,000 self-built homes over 30 years old that are ready for demolition and reconstruction. Consumers who build their own homes are typically individuals who save and accumulate funds for their own homes, representing Real Demand—those who wish to build homes for actual living rather than for speculation. This consumer group usually seeks bank loans for only 50% of the total cost. Therefore, the Home Builders Association seeks government support on the following key issues:

 

Issue 1: Measures to stimulate the real estate business for those wishing to build their own homes. Previously, the government has implemented measures to stimulate the real estate sector, but the self-built home business has never been included in the support criteria. Therefore, they request government support through a 2% personal income tax reduction on home construction costs, not exceeding 100,000 baht over a period of five years (which can be averaged equally across the tax accounting period) and exemption from land tax for individuals with vacant land designated for home construction (first homes or those who have never owned a home) not exceeding 200 square wah per person. If these measures receive government support, it will enable individuals to have their own residences without needing to sell their land to reduce tax burdens, or make it easier for those looking to purchase land for future housing. The government would not incur significant losses from this tax exemption and would demonstrate empathy towards citizens needing assistance to have easier access to homeownership.

 

Issue 2: Registration of home builders to formalize the industry. This aims to elevate standards and reduce issues related to unfinished projects, ensuring that homes are actually completed. This is a significant problem, and it would also allow the government to collect taxes from this sector, potentially generating over 20 billion baht annually.

Issue 3: Promotion and development of vocational education personnel. Currently, the home building sector lacks skilled personnel in vocational education to further develop this field. Therefore, they hope the government will promote the value of vocational education to young people and their parents, leading to more concrete development of vocational qualifications.

 

 

Additionally, Mr. Worawut mentioned that there are still government regulations that pose obstacles that need to be addressed, particularly regarding the delays and inconveniences in obtaining construction permits in various districts. Therefore, they seek reform of the relevant government agencies involved in construction permit applications to enhance efficiency.