The market value for self-built homes or home construction services across the country exceeds 200 billion baht annually, representing a significant driving force for the country's economy, ready to face new challenges and seize new opportunities in 2024.

Mr. Olar Chanphu, President of the Home Builder Association (HBA), revealed that the overall home construction market in 2023 has been filled with challenges due to business constraints stemming from the COVID-19 pandemic, which has impacted the economy and consumers' financial capabilities, alongside rising living costs from product prices and interest rates. This has led to delays in home construction decisions, resulting in a stable market situation without factors supporting growth, while not experiencing significant recession either, as there is still high real demand in the market. According to the Real Estate Information Center of the Government Housing Bank (REIC), the total value of this market, including self-built homes and home construction services nationwide, is over 200 billion baht per year. Meanwhile, the Home Builder Association has collected contract signing figures from its members during the first three quarters of 2023, showing a total value of over 9 billion baht. It is expected that by the end of the year, homes built with member companies of the Home Builder Association will have a value of around 12.5 billion baht, similar to 2022, despite earlier projections estimating the market value would increase to 13.25 billion baht by the end of this year.

Market Outlook for Home Construction in 2024

The home construction market in 2023 has continued to expand purchasing power, especially in the regions, showing good growth rates, indicating that the demand for residential homes (real demand) still exists. This is likely to drive the home construction market in 2024 to continue expanding as consumers become more aware and increasingly utilize home construction services. Additionally, the overall economy of the country, such as the projected economic growth rate for Thailand and the recovery of tourism, will contribute to this trend. Furthermore, the association has collaborated with six other real estate organizations, including the Real Estate Trade Association, Design and Construction Association, the Thai Chamber of Commerce, the Housing Developers Association, the Thai Condominium Association, the Thai Real Estate Association, the Real Estate Sales and Marketing Association, and the Thai Real Estate Broker Association, to prepare recommendations for economic stimulus to submit to the Prime Minister and the Minister of Finance. The association has proposed a personal income tax reduction for those wishing to build homes on their own land, based on the construction value according to the construction contract stamped with the Revenue Department, which can be used as evidence for personal income tax deductions in the following tax year at a rate of 10,000 baht per million baht, with a maximum deduction of 100,000 baht. This will help alleviate the burden for those wishing to build homes on their own land and stimulate the economy in all sectors connected to the home construction business. This measure also encourages home construction companies operating nationwide that are not yet registered as legal entities to register and enter the tax system, benefiting the overall economy of the country.

“I am confident that the proposed tax reduction measures will accelerate consumers' decisions to build their own homes, making it easier for them to proceed, which will consequently lead to growth in the overall real estate market of the country,” Mr. Olar stated.

Mr. Olar concluded that the overall outlook for the home construction market in 2024 must be closely monitored, especially regarding negative factors such as interest rates, uncertainties in oil prices, and the depreciation of the baht, which will affect construction material costs and transportation expenses.