History of HFA

     The Housing Finance Association was formerly known as the Housing Finance Club. HFA is an independent agency, Created on the cooperation between public and private organizations, academics and the general public including Bank of Thailand, Government Housing Bank, National Housing Authority, commercial banks, finance companies, finance & securities companies, credit fanciers, life insurance companies, university lecturers, developers and the general public. HFA disseminates housing loan information to members, to promote academic understanding in housing finance, to upgrade the standards and increase competitiveness in housing finance extension, for higher convenience to both developers and homebuyers. It also gathers problematic issues as well as suggestions in housing development, and presents the suggestions to the government so that problems could be fixed properly and timely.

     HFA was conceived during a seminar on “Effective Housing Finance” during 2-12 January 1991 which was sponsored by Government Housing Bank and Pennsylvania University. Taking place at Government Housing Bank’s headquarter, the seminar attracted 50 local and foreign representatives from the financial, property development and university sectors. During the seminar, Thai participants highlighted the importance of property development, as people from all walks of life need their own houses. In many countries particularly the United States, property development has contributed greatly to the economic growth, generating 15-20% of the gross domestic product. It has been a major tool in boosting and downsizing the economy, due to the forward and backward linkage to other economic sectors. That property development generates investment and employment contributes positive results to the entire economy. As such, Thai participants united to establish the association, having Bank of Thailand, Government Housing Bank and National Housing Authority as the sponsors, with supports from financial institutions.

     In Thailand, property development has played an increasing role to the economy particularly during 1987-1990 when construction activities mushroomed and so did the growth in housing loan extension. In the first half of 1991, the number of individual borrowers at all financial institutions increased by 67,829 with combined borrowings of Bt32,627 million. The outstanding number of borrowers and housing loans were 465,447 and Bt175,117 million, or 26.9% up from the end-1990 level. Despite the high growth in the 4-5 year period, the outstanding property loans (to both individuals and developers) stayed at only 21.2% of total outstanding loans, compared to 40% in developed countries. The low percentage points highlighted the growth potential. It was thus necessary that housing loan providers - commercial banks, Government Housing Bank, finance & securities companies, life insurance companies and credit fanciers – upgrade their services and competitiveness to pave way for the growth.

     On 27 August 1991, HFA was officially inaugurated when 35 organizations including financial institutions and 183 individuals including university lecturers and the general public subscribed for membership. The members then helped select 11 executive directors to run the association, which was then a housing finance club.