People visit a house and condominium fair in Bangkok this month. (Photo: Somchai Poomlard)

The projected economic growth for 2025, along with measures to address household debt, support for vulnerable groups and an anticipated increase in foreign arrivals, are expected to boost housing demand after an estimated 4.4% decline in 2024.

Kamonpop Veerapala, president of the Government Housing Bank and acting director-general of the Real Estate Information Center (REIC), said the outlook for 2025 is expected to show growth of 2.8-3.0%, with an average of 2.9%.

"The key driver of that growth will primarily be the continued recovery of the tourism sector, which is expected to return to levels close to those before the pandemic," he said.

Additional factors supporting growth include increased government spending with a higher 2025 budget, rising private consumption, potential interest rate cuts and continued export recovery.

"We expect property measures, including the reduction of transfer and mortgage fees from 2024, to be extended, along with further stimulus initiatives from the government," he added.

According to the REIC, the number of housing transfers nationwide is projected to reach 350,545 units in 2024, a 4.4% decline from 2023.

However, transfers are expected to rebound in 2025, with an estimated 363,600 units, representing a 3.7% increase.

In the third quarter of 2024, the overall residential market remained negative compared to the same period last year, but the decrease was less severe than in the first quarter.

This indicated signs of recovery in the housing market following stimulus measures, particularly the reduction of transfer and mortgage fees to 0.01% for residential properties valued up to 7 million baht, up from the previous ceiling of 3 million baht.

As a result, property transfers for residential units valued up to 7 million baht increased, with a rise in condo transfers, while transfers of low-rise residential properties decreased compared to the same quarter last year.

"The negative factors affecting the real estate market in 2025 will likely include high household debt, the absence of relaxed loan-to-value measures and strict lending policies from financial institutions," Mr Kamonpop said.

In addition, geopolitical conflicts, especially in the Middle East, could significantly impact oil and energy prices, while the economic policies of the new US president may affect global trade, particularly through trade restrictions.

The fragile economic recovery in China, compounded by the real estate sector's struggles and the impact of US trade restrictions, could also affect Chinese tourism numbers and reduce the purchasing power of Chinese buyers in the condo market.