Luxury property market is poised to grow following the new government's initiatives which have been widely welcomed
The luxury home sector is once again poised to surge in Bangkok. The new government seems to have instilled home buyer confidence with measures to assist developers and investors financially and kick-start the market once again.
Last month, the new government, under Prime Minister Samak Sundaravej, announced three measures that were widely welcomed in the property industry, especially by the luxury home sector.
The registration fee was reduced from 2 per cent to 0.01 per cent. The ownership transfer fee (split equally by the developer and home buyer according to the value of the purchase) was reduced from 2 per cent to 0.01 per cent and the special business tax, paid by developers, was reduced from 3.3 per cent to 0.1 per cent for 12 months. UBS Investment Research division in Bangkok expects housing demand to rise as a result.
'Various factors that support a strong recovery in housing demand have turned positive,' UBS says in a statement. 'In addition to the announced tax incentives, the interest rate has been cut 75 basis points over the past year and consumer confidence has recovered from the trough in October 2007.'
Savills (Thailand) managing director, agency and investment, Robert Collins believes there has been a degree of pent-up demand as some buyers have adopted a wait-and-see attitude since late 2006, and for the most part these purchasers are now comfortable to proceed.