It’s been almost 2 years since COVID-19 hit Thailand’s economy, affecting the overall purchasing power of business operations in all sectors. Some are slowing down or have even collapsed. In particular, real estate worth 8-9 hundred billion baht has been damaged by several shocks. It is not an easy year for Thai real estate. However, recently, “Mesak Chunharakchot,” one of the Thai Real Estate Association’s executive directors, was inaugurated as the new president of the Thai Real Estate Association after “Ponnarit Chuanchaisit,” the former president.
Mesak shed light on the overall real estate business as an index of the well-being of people in the country. If looking back at the overview of the Thai economy, it has been considered slightly grown. On the other hand, the economy before COVID was already in a downtrend as well. However, the vital point is the economy’s direction on the post-COVID and where it should be. In the period before the COVID, Thailand’s GDP was considered “low growth,” with only about 1-3% GDP. Still, if we look closely, the foreign investment that accounted for 1 out of 3 of the export industry has slipped away.
Meanwhile, the primary income of Thailand relies on the export sector, tourism, and agriculture, which were shut down as a result of COVID. Furthermore, the number of the elderly population has increased, as well as the declining labor population and the adaptation of workers who are unable to fit into the new industrial system, resulting in the “middle-income trap,” which remains insoluble and terrifying. Therefore, real estate should be the new potential economic force to stimulate the economy for all sectors because it has high multiplier effects.
Mesak also states that as the Thai Real Estate Association president, he must carry out concretely to respond to the necessity of stimulating and recovering the country’s economy through real estate and connecting it with service businesses. The measure that supports long-term living from people worldwide to live in Thailand is an excellent step to spread income widely, not only in real estate but also in all sectors.
The new Thai Real Estate Association president stated that “the real estate trend continues to slow down in the long term. Therefore, in the short term, the urgent agenda must rely on the government to help stimulate it. In our experience, the most effective real estate stimulus measures are canceling the 3.3% specific business tax and continuing the reduced transfer and mortgage fees measure, which will expire at the end of the year. As for the risk factors that are worrying in 2022, those that will affect real estate are: construction material price increases, a liquidity problem that must be cautious about because NLP tends to increase, and the labor shortage problems, which need to be addressed with countermeasures,” said Mesak.
It is considered a severe challenge for the new president to boost Thailand’s real estate to be a new force driving the economy. Meanwhile, it is a great opportunity for the real estate sector to play a key role in stimulating Thailand’s economy.