A visitor examines deals at the House and Condo show in May 2024. Access to mortgages remains challenging for prospective buyers with a lower income. Varuth Hirunyatheb

The recent easing of loan-to-value (LTV) limits may not boost residential transfers and sales as much as expected, particularly after last week's earthquake in Myanmar impacted the high-rise condo market.

Surachet Kongcheep, head of research & consultancy at property consultant Cushman & Wakefield Thailand, said that despite the relaxation of LTV limits, prospective condo buyers, particularly those considering high-rise projects, are likely to delay their decisions.

"Any residential market stimulus measures introduced at this time will likely have only a minimal impact," he said. "But it is still better than none because they can boost low-rise housing demand."

Concerns about safety in high-rise condos outweigh the appeal of reduced transfer fees. Buyers scheduled to transfer units in high-rise buildings are likely to wait and assess the situation rather than rush the process, he added.

On March 20, 2025, the Bank of Thailand announced a temporary easing of LTV regulations for mortgage loans and related credit, applicable to loan agreements signed between May 1, 2025, and June 30, 2026.

The new rules allow a 100% LTV ratio for mortgages, covering properties valued below 10 million baht from the second loan onwards, and properties valued at 10 million baht or more from the first loan onwards.

Previously, units valued below 10 million baht were eligible for an LTV ratio of 80-90% for the second loan, and 70% for the third loan onwards. For units valued at 10 million baht or more, the LTV ratio was set at 90% for the first loan, 80% for the second, and 70% for the third loan onwards.

Many developers believed that the LTV easing could enhance purchasing power for homebuyers who are still repaying their existing home loans if they qualify for a 100% LTV ratio on second mortgages.

Most of these buyers purchase condos as second or third homes because the new units are closer to their children's schools or closer to their own workplaces, while they continue paying off their existing bank mortgages.

However, prior to the earthquake, SCB Economic Intelligence Center (SCB EIC) already believed that the impact of the LTV easing might not be as significant as expected, serving only as a short-term stabiliser for the market.

The measure may provide only a slight boost in absorbing housing stock priced below 10 million baht, as accessibility to mortgage loans remains a challenge for lower-income buyers, according to SCB EIC.

Meanwhile, Kasikorn Research Center (K-Research) suggested on March 24 this year that the easing of LTV limits could further support housing loan growth in 2025 by an additional 0.1-0.2% beyond the previous forecast.

K-Research initially projected housing loan growth of slightly above 0.5% prior to the LTV easing. After the adjustment, the forecast was raised to 0.6-0.7%, up from just 0.3% growth in 2024, which was the lowest level in 23 years.