For young Thais, owning a home put on hold

Rentals favoured as access fades

- SOMRUEDI BANCHONGDUANG

Young consumers today place greater value on access than ownership, a mindset fuelling the growth of the sharing economy and, in turn, the rental economy.

For many young Thais starting their careers, buying a home is less of an immediate goal and more of a long-term aspiration.

As access to mortgages tightens, first-time workers are finding it harder to step up the property ladder, a shift that mirrors changing lifestyle preferences among younger generations, who are increasingly choosing to rent rather than buy.

According to Thakorn Piyapan, president of TMBThanachart Bank (ttb), homebuyers earning less than 30,000 baht a month face significant hurdles in securing mortgages. This income bracket largely comprises new graduates and first-time workers entering the workforce.

Lenders are shifting their focus towards higher-income borrowers, typically those earning at least 50,000 baht per month, reflecting a more cautious approach to risk amid economic uncertainty and elevated household debt.

At ttb, the target market is even higher. The bank is prioritising new homes priced at 7-10 million baht, focusing on customers earning a minimum of 70,000 baht a month.

The strategy reflects a combination of pressures: a fragile economic outlook, elevated household debt, stricter assessments of borrowers’ repayment capacity, and rising house prices driven by higher raw material costs.

"Under these circumstances, new graduates and first-time workers earning no more than 30,000 baht a month have limited access to mortgages," Mr Thakorn said. "Meanwhile, the rejection rate for mortgages has remained at 60-70% of total applications over the past few years."