The Bank of Thailand (BOT) has adjusted the Loan-to-Value (LTV) regulations, allowing first-time homebuyers for properties priced under 10 million baht to borrow 100% of the property's value, plus an additional 10% for necessary living expenses such as home decoration, repairs, or renovations. For second homes, the down payment has been reduced to 10% if the first home has been paid off for at least 2 years, and at least 20% if it has not. The down payment for third homes remains at a minimum of 30%. For properties priced over 10 million baht, the down payment for the first home is now 10%, down from 20%, while the second home requires a 20% down payment, and the third home and beyond still require 30%. These changes take effect from January 20, 2020.

Mr. Ronadol Numnon, Deputy Governor for Financial Stability at the Bank of Thailand, stated that the LTV regulations have been revised to support homebuyers. The first home priced below 10 million baht can now be fully financed, with an additional 10% available for necessary expenses. For second homes, the down payment has been lowered to 10% if the first home has been paid off for at least 2 years, and 20% if not. The previous requirement was a 3-year period. For third homes and beyond, a minimum down payment of 30% is still required. For properties over 10 million baht, the first home requires a 10% down payment, the second home 20%, and the third home and beyond 30%. This policy is effective from January 20, 2020.

The reason for not lifting the LTV ceiling is due to previous observations that over 50% of second home loans were for speculative purposes, which led to increased housing prices, negatively impacting genuine homebuyers. Since the implementation of the LTV measures in April 2019, new housing loans have grown by 5.6% over the first 11 months of 2019, while housing prices, particularly for condominiums, have decreased.

Regarding the household debt situation in Thailand, it remains concerning, with the household debt-to-GDP ratio at 79.1% in the third quarter of 2019, and it is expected to rise further. Household debt is unlikely to decrease this year due to the slowing economy. Therefore, it is essential to avoid encouraging additional debt, especially among vulnerable groups.

Mr. Prasert Butdulyasatit, CEO of Pruksa Real Estate Public Company Limited and Honorary President of the Thai Condominium Association, stated that it is a positive sign that the BOT is reconsidering its measures. He hopes that, after reviewing the declining figures in the real estate market and housing loans, the BOT will further relax the criteria to help revive the market.

Mr. Chatchai Sirilai, Managing Director of the Government Housing Bank (GHB), expressed that GHB is ready to implement the new BOT criteria immediately, as it is an improvement that directly benefits citizens seeking to own their homes, particularly low- and middle-income clients. This will provide them with increased loan amounts under the bank's conditions and is expected to support the country's economic growth through increased housing transactions.