Sale Of Second-hand Houses Projected To Rise

[george]

Sale of second-hand houses projected to rise

BANGKOK: -- The sale of second-hand houses is projected to increase following the Finance Ministry’s plan to seek the cabinet approval for tax measures to stimulate the market, according to an industry executive.

The measures include a reduction in transfer and mortgaging fees to 0.01 and the same rate from 2 and 1 per cent, respectively, and an exemption of a duty stamp, which is currently collected at 0.5%.

The ministry is also considering whether the special business tax should be cut to 0.11 per cent from 3.3 per cent.

Second-hand houses that are entitled to the incentives must be owned for five years and occupied for one year.

Kitti Pattanapongpibul, President of the Mortgaging Loans’ Association, said the measures would help stimulate the second-hand house market in terms of value and volume.

In the past, the market had been sluggish because potential buyers are concerned about costs of ownership transfer fees, which are as high as around 6 per cent of an asset price.

Usually, the prices of second-hand houses are around 10-20 percent lower than those of the new ones.

Should the transfer fees be cut, the houses would be more attractive, he said.

“At the same time, should the Real Estate Information Center be able to collect complete information on second-hand houses, it will stimulate the purchase more because potential buyers can use the information to make an easier decision,” said Mr. Kitti.

Arthip Peechanond, President of the Thai Condominiums’ Association, said the ministry’s announcement of the planned tax measures to stimulate the second-hand houses might cause a confusion and delay people’s decision to purchase houses for a time being.

He said the ministry should rather wait for the cabinet approval and put the measures into effect immediately.

The move should better stimulate the market, he noted.

As well, he suggested the government develop second-hand house brokers to make sure that they have accurate and sufficient information for customers to make a decision on the house purchasing efficiently like that overseas.

He said the brokers could play a more important role than the information dissemination via websites in helping stimulating the second-hand house market.

--TNA 2005-09-12

[bkk_mike]

Actually - coming here from London I didn't think it would be possible that I'd ever wish for more estate agents. - But, in Bangkok anyway, they don't seem to exist... - You only ever see adverts / stalls in shopping centres where they're selling new properties...