LAND MARKET, FEE FROM LAND TRANSFER AND GOVERNMENT INTERVENTION ANALYSIS

Abstract

This paper empirically investigate land market in Thailand over the period BE2539 and BE2560 with the objective on : i) analyse changes and fluctuations in the value of land transfer; ii) study government market intervention in the form of reduction in land transfer fee, and iii) effects of such policy on local government finance. The study compiled quarterly data of land market and real estate loan from Land Department, Bank of Thailand and Office of the National Economic and Social Department Council and formulate the econometric model, also qualitative analysis from documents/data and in-depth interview. Findings are summarized as follows: a) descriptive statistics indicate that over the whole period the value of land transfer has highly fluctuate; b) there were series of government intervention in the form of reduction in land transfer fee to stimulate real estate business; c) the positive effects on land market were apparent short-run—but afterwards the value of land transfer dropped noticeably; d) government should compensate the Local Administrative Organization for the revenue foregone.