Property market hard hit in Q1

Thailand's property market was hard hit by politics in the first quarter of this year, with sales plunging by 43% to 56.48 billion baht, according to Agency for Real Estate Affairs.

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By unit, the sales dropped 42% to 20,433.

The Fiscal Policy Office said in its report on Tuesday the property market looked set to contract in 2014.

In addition to political instability, other negative factors are the fragile world economic recovery and Thailand's high household debts, at 82.3% of gross domestic product in the fourth quarter of 2013.

The only positive factor for the market is relative low interest rates, which hinge on the Bank of Thailand's 2% policy rate, a level likely to stay put this year.

Other indicators painted the same picture. Property transaction tax collections shrank by 3.8% in February while domestic cement sales declined by 3.5% year-on-year in March.

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