Thailand’s Government Housing Bank (GHB) has sought approval of the Finance Ministry and the cabinet for the third phase of the “One Million Home” project, providing housing to low income-earners.
The third phase of the project will cost the GHB about 20 billion baht, to be provided to real estate developers, which invest between 200 and 300 million baht per housing project, to build detached, semi-detached houses and condominiums for sale to low income-earners at an average price of 1.5 million baht per unit.
According to GHB President Chatchai Sirilai, the bank is expected to extend housing loans to home buyers from January.
The interest rate for the first five years of the mortgages will be pegged at 3% and the repayment period will be up to 40 years.
For the second phase of the project, the interest rate was set at 1.99% for the first four years and the repayment period is from 7 to 40 years.
By the end of this year, the GHB is expected to have lent a total of 280 billion baht in mortgages, against the initial target of 226 billion baht, due to an increase in interest rate and the Bank of Thailand’s refusal to extend the loan to value measure.
The bank’s non-performing loans are expected to decrease to 59 billion baht by the end of this year, from 65 billion baht, or a 4.4% reduction.
