According to the Real Estate Information Center (REIC), higher interest rates and the cancellation of support measures for real estate have weakened the mood of developers, while the return of Chinese tourists gives hope for an increase in sales.
In the fourth quarter of last year, developers were more worried about the impact of higher interest rates on their business. Their sentiment towards sales and new launches fell by 1.7–2.3 points after the announcement of interest rate hikes in late September and November 2022.
However, their sentiment towards investment and development costs increased by 1.8 and 4.4 points, respectively. This reflected their confidence in housing construction in 2023.
According to REIC, the index of the current situation of developers in Greater Bangkok in the fourth quarter of 2022 decreased slightly to 51.5 from 51.8 in the third quarter, which increased from 47.1 and 49.8 in the first and second quarters, respectively.
The lowest index was the ratio to project development costs — 33.0, although this is more than 23.6 and 28.6 in the second and third quarters, which is associated with the beginning of the conflict between Ukraine and Russia at the beginning of last year.
Competition in the housing market will continue to grow this year, as developers expect to start more projects, as they are confident in the demand from foreign buyers and tenants.
REICH also reported that the expectations index for the next six months improved to 60.5 in the fourth quarter of 2022 from 57.9 in the third quarter.
The index on the future of investment, employment, development costs and new launches increased due to the economic recovery, but the productivity and sales index fell mainly due to the cessation of government incentives.