Bangkok Post by Kanana Katharangsiporn

Housing sales in the fourth quarter will improve as developers and financial institutions speed up sales while the Government Housing Bank (GH Bank) insists it will not raise mortgage interest rates until the end of the year.Samma Kitsin, director-general of the Real Estate Information Center (REIC), said demand in the low- and medium-priced segments had been good this year but high-end sales were very poor as the global recession had hurt foreigners' confidence. "If financial institutions relax mortgage loan conditions, housing sales this year will be better than expectations," he said yesterday. GH Bank president Khan Prachuabmoh said the state bank, the country's biggest mortgage lender, would not raise interest rates this year but they would probably increase next year as financial institutions competed to draw deposits. GH Bank plans to soon introduce the GH Bank-BoI Home loan programme with special rates for BoI Home buyers, starting from Jan 1. "We will seek a package to reduce the payment burden of buyers of units costing one million baht, who now pay around 7,000 baht a month. They are the main BoI Home buyers," said Mr Khan. This month the bank will also sign an agreement with the Secondary Mortgage Corporation to sell housing loans. As of Tuesday, GH Bank had released a total of 74 billion baht in home loans for the year. For the Fasttrack Home Loan programme, it approved 5,000 homebuyers with credit lines of 2.5 billion baht from 8,000 applicants seeking 7.5 billion baht. REIC yesterday reported an increase of 2% in the number of new housing registrations in Greater Bangkok during the first eight months of the year, totalling 54,029. Of this number, 49% were condominiums, followed by single houses at 36% and townhouses at 9% (See table). Mr Samma said single house and townhouse price indices declined to 150.2 and 151.0 respectively in the third quarter, down 6.2% and 2.3% from the second quarter. This may indicate a shift in homebuyer's behaviour to condominiums and townhouses rather than single house. Single house prices in Bangkok rose, following land costs, encouraging homebuyers to seek cheaper units on the outskirts. REIC's housing developer sentiment index in the third quarter stood at 55.8, the highest since it began preparing the index since 2006, and up from 48.1 in the second quarter. At the same time, the expectations index, which evaluates developers' expectations in the first quarter next year, rose from 62.2 to 69.9, showing more confidence in an improvement in Thai political and economic conditions in 2010. In September 2009, there were 21 new projects launched with a total of 4,314 units worth a combined 20.69 billion baht, according to Agency for Real Estate Affairs. The value of new launches increased by 50% from 14.17 billion baht in August as 68% of units were priced higher than 3 million baht. The average price rose to 4.796 million baht from 3.2 million. The largest number of new units were condominiums at 2,474, accounting for 57.3%, followed by 795 single houses or 18.4% and 758 townhouses or 17.6%. Condominium launches exceeded those of low-rise units in September, with most located in the inner city, prime areas and near mass transit. Response to these additions was strong and some developments were sold out within a month.