Thai housing market still on shaky ground

TRIS Rating, the Bangkok-based Thai credit rating agency, said Thailand´s housing market was still unstable and would remain so for the rest of this year.

Despite government efforts to stimulate the ecomomy, TRIS said there was no immediate end in sight for the downturn and continued sluggishness in demand for housing would continue for the foreseeable future.

The credit rating agency attributed the decline to a lack of Thai consumer confidence; the spending capacity of prospective home-buyers; economic recession; increasing unemployment; the stock market plunge and politcal unrest.

TRIS said these factors had collectively undermined consumer confidence in Bangkok and elsewhere in the country. The National Economic and Social Development Board (NESDB) has already forcast that the Thai economy will likely shrink by 2.5 to 3.5 percent this year.

Local housing developers would continue to face a weakness in the market, especially in the single house and townhouse sectors for the remainder of this year, said TRIS.

The firm also said new condominium start-ups had declined and would likely result in fewer start-ups this year compared with 2008.

The agency said its credit rating of housing developers for 2009 had also been revised. It would base its ratings on the ability of executives to adapt to the new business environment; financial discipline; liquidity; management capability; good connections with financial institutions and strong support from parent companies.

Asia Property Report - 2009 July 08 - News