Photo courtesy of Bangkok Post

 

A significant rise in home seizures has raised alarms among mortgage borrowers, according to new data presented by Onfa Vejjajiva, secretary-general of Thailand's National Economic and Social Development Council (NESDC). The Real Estate Information Center reported a 210% year-on-year increase in auctioned residential properties, totaling 67,600 units in Q2 2025. The rising household indebtedness is exacerbated by recent flooding, particularly impacting the agricultural sector.

 

Recently, the NESDC has expressed the need for immediate support to mortgage borrowers to prevent foreclosures. Ms. Onfa highlighted the importance of improving flood-affected households’ access to credit, citing initiatives like the Bank for Agriculture and Agricultural Cooperatives' 20-billion-baht emergency loan program. The challenges stem partly from an oversupply in the real estate market and poorly timed investments, amplifying financial instability among borrowers.

 

A Bank of Thailand study disclosed that borrowers, even post-auction, may face additional asset seizures. Ms. Onfa emphasized pre-legal measures like debt restructuring to mitigate residential losses. The NESDC also projected varying economic impacts from the flooding, with possible GDP reductions ranging from 0.1 to 0.16 percentage points, depending on the extent of damage, which could tally between 18 billion and 29 billion baht.

 

Currently, household debt stands at 16.3 trillion baht, a decrease from previous quarters, despite growth in real estate loans influenced by relaxed lending regulations. Second-quarter data indicates a rise in non-performing loans to 1.24 trillion baht, yet a decline in short-term overdue loans due to ongoing debt restructuring efforts.

 

A study on VAT hikes by the NESDC explored models from countries like Japan and Singapore. Faced with high government spending and a public debt forecast to reach 68.2% of GDP by 2030, the agency warned that a VAT increase might be unavoidable. However, Ms. Onfa cautioned that Thailand is not ready for such a hike, as domestic consumption has not sufficiently recovered.

 

Looking forward, any VAT adjustment is expected to follow a gradual increase model, providing ample time for public preparation. While such a change could generate significant revenue to support social programs, it remains contingent on continued economic improvement, reported Bangkok Post.

 

Key Takeaways

• Home seizures up 210% in Q2 2025, linked to flooding impact.
• Household debt decreases, but non-performing loans rise.
• VAT hike considered, but dependent on economic recovery.

 

Related Stories

Thailand’s THB 3.45 Trillion Property Waste

CIB Arrests Bang Saen Property Developer Over Bounced Cheques

 

  Adapted by ASEAN Now from Bangkok Post 2025-11-25

 

 

 

Does a house that floods every year or two have any resale value?

Better to let the existing owners stay and pay what they can.

Just my opinion.