The results of the business operators' confidence survey for Q3 2023 show a slight increase in overall confidence compared to the previous quarter, yet it remains below 50 points continuously since the first quarter of this year. This is attributed to various negative factors, particularly the increase in the policy interest rate by the Bank of Thailand. Only the confidence in employment and in launching new projects and/or new phases is above 50 points. The overall confidence index for the next six months stands at 60.1, which, despite a decrease, is still above the average.

The Real Estate Information Center of the Government Housing Bank (REIC) reported that the Current Situation Index for business operators in residential development in Bangkok and its vicinity for Q3 2023 is at 49.7, a slight increase compared to 47.5 in Q2 2023. However, compared to the same period last year, which had an index of 51.8, confidence has decreased and remains below the average level of 50.0, indicating that operators have slightly increased confidence but still harbor concerns about the current business situation.

Dr. Vichai Viratakphan, Inspector of the Government Housing Bank and Acting Director of the Real Estate Information Center, stated that although the overall confidence index for business operators in residential development in Bangkok and its vicinity remains below average, a detailed examination reveals that confidence in certain areas is above 50 points, including employment at 55.1 points, which is an increase of 1.9 points from the previous quarter, and in launching new projects and/or new phases at 61.2 points, which has also increased from the previous quarter and compared to the same period last year.

Other confidence indicators remain below 50 points, indicating a lack of confidence or concerns, including performance at 47.6 points, which has been below 50 for four consecutive quarters, sales at 41.8 points, and investment at 49.7 points, which has decreased from the previous quarter. Meanwhile, operational costs (inversely related) are at 42.8 points, which is below 50 but has improved from the previous quarter.

The survey results indicate that in Q3 2023, operators still have low confidence, as evidenced by the index being below 50 points continuously since the beginning of 2023 due to various negative factors, particularly the five increases in the policy interest rate by the Bank of Thailand from 1.25% to 2.50% in Q3 2023. However, the slight increase in confidence from the previous quarter is observed in three areas: performance, employment, operational costs (inversely related), and launching new projects and/or new phases.

When analyzing confidence by operator group, it was found that the current confidence index for Listed Companies in Q3 2023 is at 54.7, higher than the previous quarter's index of 52.1 and above the average of 50.0, indicating that operators in the Listed Companies group still have confidence in the current business situation. The confidence of Listed Companies is above 50 points in performance, investment, employment, and launching new projects and/or new phases, but confidence in sales and operational costs (inversely related) remains below 50 points.

In contrast, the confidence index for Non-listed Companies in Q3 2023 is at 42.3, an increase from the previous quarter's level of 40.6, yet still below the average of 50.0, indicating that small operators in the Non-listed Companies group are more concerned about various negative factors than those in the Listed Companies group. The confidence of Non-listed Companies is below 50 points in almost all areas except for employment and launching new projects and/or new phases, which are above 50 points (see Table 1 and Chart 1).

 

The confidence index for business operators in residential development in Bangkok and its vicinity for the next six months (Expectations Index) is at 60.1, slightly down from 62.1 in the previous quarter and still above the average of 50.0, reflecting that operators have a positive outlook on the real estate business situation in the next six months. When examining each area, it shows a decrease in almost all aspects, except for operational costs (inversely related), which increased by 2.1 points, indicating that operators can reduce production costs more than in the previous quarter.

The overall confidence increase for the next six months is likely due to positive views stemming from the establishment of a new government and the introduction of economic stimulus measures through tourism, such as the temporary visa exemption for tourists from China and Kazakhstan, effective from September 25, 2023, to February 29, 2024, for a total of five months, to facilitate and encourage tourists from both countries to travel to Thailand, which is expected to be a significant factor in reviving foreign demand for housing.

When categorizing operators by company type, it was found that Listed Companies have a confidence index for the next six months of 64.7, above 50.0, but slightly down from 69.1 in the previous quarter, indicating that operators in the Listed Companies group still have reduced confidence in the real estate business. This decrease is observed in almost all areas from the previous quarter, particularly in employment, which dropped by -11.2 points, except for confidence in operational costs (inversely related), which increased.

Meanwhile, the confidence index for Non-listed Companies stands at 53.3, above 50.0, showing a slight increase from 51.6 in the previous quarter, indicating that operators in the Non-listed Companies group have increased confidence, particularly in launching new projects and/or new phases, investment, employment, and sales, although operational costs (inversely related) and performance have decreased (see Table 2 and Chart 2).