National Housing Policies and ProgramsThailand

National Housing Policies and Programs

Ballobh Kritayanavaj, Senior Vice President

Government Housing Bank

Thailand

April 19, 2010

Demographics – Thailand

Population – 65 million Population growth – less than 0.5 per cent

per year Migration increasing urban housing needs 36 per cent – urban population GDP per capita - $US4,072

National Housing Policies

NESDB : National Housing Policy Subcommittee

1982-1997

GH Bank + NHA + NESDB + Private sector

Annual National Housing Report

No comprehensive national housing policy

3 main government units implement government middle and

low-income housing programs

Government Housing Bank (GH Bank), National Housing

Authority (NHA) and Community Development

Organization Institute (CODI)

Private sector provides housing from low-income to

multi-million baht homes

New Housing Policies

Cabinet approved National Housing Policy

Committee – May 28, 2008

Major responsibility of NHPC – oversee

formulation of comprehensive

long-term national housing policy

NHA and CODI play major role in housing provision for lower income groups

Private housing developers play a leading role in housing development for low - middle –

high income group

Specialized Financial Institution (SFI) – Ministry of Finance

Major emphasis – lower and middle income mortgages

Total Assets Bt692 billion ($US21 billion) (2009)

Branches : 76 + 71 points of services

Employees : 2,321

36.3 per cent of all outstanding home loans (2009)

About GH Bank

Assuring shelter for all residents in Thailand

Operates as state enterprise

Rental apartments, condominium, government

employee housing

Currently, primarily acts as an enabler between

government and private sector

National Housing Authority (NHA)

Project to build 600,000 homes - 2005 Scaled down – currently 200,000 under

construction Government subsidies granted to private sector

developers Houses sold at affordable prices GH Bank and Government Savings Bank - buyer

financing

NHA – Baan Eur-Arthorn Project

Special Program : Special Program :

GHB’s GHB’s Mortgage Interest RatesMortgage Interest Rates

TypeRate Remainder of

Loan Term

LTV

Ordinary Customer

1st - 2th Year = MRR - 2.00 % = 4.50 %

3th Year = MRR - 1.00 % = 5.50 %

4th Year = MRR - 0.50 % = 6.00 %

MRR - 0.50 = 6.00%70% - 85%

Government Pension Fund

1st Year = 3.99 %

2st Year = MRR – 2.25 % = 4.25%

3th Year = MRR – 1.25 % = 5.25 %

MRR – 1.25 % = 5.25 % 100% - 110%

Baan Eua Arthorn

1st Year = 3.00 %

2st - 3th Year = MRR – 1.50 % = 5.00%

4th Year = MRR – 1.00 % = 5.50 %

MRR – 1.00 % = 5.50 % 100%

Social Security member

Fixed Rate

2-Year = 4.50%MRR – 1.00 % = 5.50 % 80% - 90%

Deposit RatesDeposit RatesCommercial Banks VS GH BankCommercial Banks VS GH Bank

Comparison Deposit Rates GH BANK VS Commercial Banks

Type of DepositGH BANK

(%)Commercial Bank

(%) Saving Account 0.75 0.50

Special Saving Account 1.00 0.50 - 1.25

Time Deposit Account    

3 - Month 1.00 0.65 - 0.75

6 - Month 1.00 0.65 - 1.00

12 - Month 1.50 0.65 - 1.00

24 - Month 2.00 1.50

36 - Month 3.00 1.75

60 - Month 3.50 1.50 - 2.50

Sources : GH Bank and Bank of Thailand (BOT) as of 10 Feb 2010

Net Interest Margin : Net Interest Margin : Commercial Banks VS GHBCommercial Banks VS GHB

Community Organization Development Institute (CODI)

Finance slum-area communities Develops community-based savings programs and

organization through co-operatives Funded from Government budget Baan Mankong program – very successful Since 2003, CODI has funded more than 77,000

households in more than 245 districts throughout Thailand

Well developed private-sector housing industry

Provide most homes from low-income sector

to multi-million dollar homes

Commercial banks financing readily available

– 55 per cent market share

GH bank market share of home loans

– 36 per cent

Private-sector developers and mortgage lenders

Income tax exemption for developers (5-8 years)

Key investment promotion conditions

Housing project – minimum 50 units

Condominium unit – not less than 28 sq. meters

and sales price – not exceeding 1 million baht

Townhouse or detached house plot – not less than 70

sq. meters and sales price – not exceeding 1.2 million

baht

BOI Promotional Housing Investment Policy - Thailand

Housing Units Nationwide Approved by Board of Investment (BOI) 2009

Housing Completion in Bangkok Housing Completion in Bangkok and Metropolitan Regionand Metropolitan Region

Newly - launched Housing Units - Bangkok and Vicinity

New Home Loans in ThailandNew Home Loans in Thailand

Market Share of New Home LoansMarket Share of New Home Loans

Home Loans Outstanding in ThailandHome Loans Outstanding in Thailand

Market Share of Home Loans OutstandingMarket Share of Home Loans Outstanding

Keys to future growth – policy issues

Reducing housing costs (Construction Technology)

Government incentive programs for the LIG (BOI)

Further developing housing financing markets

Developing resale housing markets (professional

brokers + licensing law)

Strengthening professional housing associations

Statistical data and Information for a well- functioning

housing market (REIC+ GH Bank journal)

Housing and housing finance education for the public

(Homeownership counseling services)

T h a n k y o u

www.ghb.co.th