The President of Thailand’s Agency for Real Estate Affairs has warned against the possible formation of a bubble in the kingdom’s property market.
Dr. Sopon Pornchokchai expressed his opinion that, during 2011-2012, a bubble could form because of rapid construction of low-priced housing as developers rush to take part in the county’s Board of Investment homes project.
He said: “When there is more supply, it is likely that there would be more speculation,” adding that the Royal Thai Government should not support any “unnecessary” purchases of second homes which could lead to speculation in the sector. He also urged home buyers to manage their finances well, and for lenders to be prudent with their financing, especially in the case of projects being constructed in poor locations.
The Agency has forecast the value of new homes being launched during 2010 will be worth THB158.4 billion (US$4.84 billion) – down 15 per cent on the value of homes launched during 2009.
It seems that low cost housing in Bangkok of which there is a possible over supply. I see no reason why this would affect property as a whole and have certainly seen no evidence of a bubble forming, quite the opposite, because if anything there remains a shortage of certain types of property especially in Phuket.