Mortgage Loans Slow, Low-Price Homes Concern Banks

Prachachat•Economy•249d ago

Reader Briefing

Thai banks predict continued contraction in new mortgage lending for 2025, with homes under 3 million baht posing a significant concern, leading institutions to shift focus to refinancing and home equity loans.

•The Thai real estate market is expected to remain sluggish in 2025, with new mortgage lending projected to contract by 0.6%.
•Homes priced below 3 million baht are identified as a particularly worrying segment due to economic weakness and high household debt.
•Banks like Kasikornbank and TMBThanachart (TTB) are adapting by focusing on existing customers, developer partnerships, and expanding refinance and home equity loan offerings.
•Non-performing loans (NPLs) for mortgages are expected to stabilize in 2025, partly due to existing support measures and increased bank caution.

Overview

•In 2025, new mortgage lending is projected to shrink by -0.6%, totaling 575,000 million baht.
•The real estate market is not showing signs of recovery in mid-2025, as housing loans typically follow economic growth by 2-3 quarters.
•Economic slowdown, election uncertainties, and a lack of stimulus measures are contributing to the subdued market conditions in 2025.
•Kasikornbank plans to target its existing customer base of 23 million K PLUS users and collaborate with developers for special interest rate campaigns in 2025.
•The market for homes below 3 million baht is a concern in 2025 due to the weak economy and high household debt.
•The market for homes priced at 10 million baht is expected to grow slower in 2025, serving to support the market rather than drive significant expansion.
•TMBThanachart (TTB) will focus on the refinance market, aiming for 15% growth in 2025, and the home-for-cash market, targeting 30-40% growth.
•TTB sees opportunities for expansion in the refinance and home-for-cash markets, especially as repayment of existing loans is faster than new lending.

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Source: Prachachat (Original)

Key Quotes

Natthapol Luepromchai

"Banks estimate the real estate market in 2025 will not recover, continuing to suppress new mortgage lending. Homes below 3 million baht remain concerning. Kasikornbank expects total new loan disbursements to shrink by -0.6%."

แบงก์ประเมินตลาดอสังหาริมทรัพย์ปี’69 ยังไม่ฟื้นตัว กด”สินเชื่อบ้านปล่อยใหม่”ซึมต่อเนื่อง บ้านต่ำกว่า 3 ล้านบาท ยังน่าห่วง “กสิกรไทย” คาดยอดสินเชื่อปล่อยใหม่ทั้งระบบหดตัว -0.6%

Natthapol Luepromchai

"The market for homes priced below 3 million baht is concerning and still negative due to the weak economy and high household debt."

ตลาดบ้านราคาต่ำกว่า 3 ล้านบาท เป็นตลาดที่น่ากังวล ยังติดลบอยู่ เพราะยังไม่ได้กลับมาแข็งแรงจากสถานการณ์เศรษฐกิจ และหนี้ครัวเรือนที่สูง

Jare Jearananon

"The real estate market this year is expected to continue slowing from 2024’s significant contraction, especially for homes below 3 million baht."

ตลาดอสังหาฯปีนี้น่าจะชะลอตัวต่อเนื่องจากปี 2568 ที่ตลาดหดตัวติดลบพอสมควร โดยเฉพาะบ้านต่ำกว่า 3 ล้านบาท จะชะลอตัวลงมากกว่ากลุ่มอื่น

Jare Jearananon

"TTB aims this year to focus on growth in the refinance and home-for-cash (Cash You Home) loan markets."

ทีทีบีตั้งเป้าปีนี้ว่าจะยังคงเน้นเติบโตในตลาดสินเชื่อรีไฟแนนซ์และสินเชื่อบ้านแลกเงิน (Cash You Home)

Key Entities

Organization

Kasikornbank(กสิกรไทย)ℹ️

A major Thai bank that forecasts continued contraction in new mortgage lending for 2025.

TTB(ทีทีบี)ℹ️

A Thai bank that is focusing on refinance and home-for-cash loans due to the slowdown in new mortgage lending.

Bank of Thailand(ธนาคารแห่งประเทศไทย)ℹ️

The central bank of Thailand, whose measures are mentioned as contributing to the stabilization of non-performing loans.

Person

Natthapol Luepromchai(นายณัฐพล ลือพร้อมชัย)

First Senior Executive Vice President of Kasikornbank who provided insights into the mortgage market.

Jare Jearananon(นายจเร เจียรธนะกานนท์)

President of Retail Credit Products Division at TMBThanachart (TTB) who commented on market trends.