The Thai stock market witnessed a surge in the share prices of listed property developers on Monday, propelled by the government’s proposal to raise the ownership limit for foreigners in condominiums to 75%.
At 12:16 local time in Thailand on June 24, 2024, Origin Property Public Company Limited (SET: ORI) saw a 5.21% increase, while Sansiri Public Company Limited (SET: SIRI) and Ananda Development Public Company Limited (SET: ANAN) rose by 3.09% and 3.08%, respectively. Meanwhile, Noble Development Public Company Limited (SET: NOBLE) and AP (Thailand) Public Company Limited (SET: AP) experienced gains of 2.38% and 0.61%, respectively.
The Office of the Prime Minister sent an urgent request to the Ministry of Interior to explore extending lease terms from a maximum of 30 years to 99 years and amplifying the foreign ownership threshold in condominiums from 49% to 75%. Notably, the initiative would kick off with properties in Bangkok, Phuket, and Pattaya, the country’s top tourist hubs.
Despite the notable push from the government, the proposal has triggered mixed reactions among the populace. While some individuals perceive it as a means to alleviate the excessive supply in the Thai property market, others criticize the move, branding it as disloyal to the nation for potentially granting foreigners predominant rights over Thai properties.
Vichai Wiratkapan, the acting director of the Real Estate Information Center (REIC), highlighted that by the close of 2023, there were 228,102 property units on sale, amounting to a total value exceeding 1.2 trillion baht. This signified a 10.8% surge in unit terms and a 21.5% rise in valuation terms. The data also underscored a slowdown in the launch of new projects, resulting in an oversupply issue in the market.
The prospective reform in foreign ownership regulations is not only perceived as a strategy to address the surplus in the property sector but is also viewed as a potential gateway for an influx of foreigners into Thailand, a country known for its relatively low cost of living compared to developed Western nations – unless stringent measures are in place to regulate this inflow.