Developers set to make up for slow 10-month presales
Low purchasing power during first half of the year cited
Some leading property firms posted lower presale values in the first 10 months than in the same period of last year, blamed on a drop in purchasing power in the first half of 2014.
As a result, they are pulling out the stops to shore up sales in the remaining months, according to survey by The Nation.
Pruksa Real Estate reported presales of Bt32.33 billion in the first 10 months, down 7.2 per cent year on year. The company targets full-year presales worth Bt42 billion.
Sansiri only managed Bt8 billion in presales in the 10-month period, down 78 per cent (see graphic).
However, some did manage higher presales in the period.
AP (Thailand), Supalai and Property Perfect posted increases, attributed to strong marketing campaigns and project launches in locations that were in demand.
“Our presales dropped in the first half of this year when the country was in political turmoil, but now the market is recovering.
“As a result, we believe that our presales will achieve the full-year target of Bt42 billion,” Pruksa president and chief executive officer Thongma Vijitpongpun said.
Sansiri president Srettha Thavisin said the company cut its presale target early this year.
The company has a backlog that will generate revenue through 2016.
“We do not need to boost our presales this year but we need to boost our revenue and net profit,” he said.
According to a survey by the Government Housing Bank’s Real Estate Information Centre, the first 10 months of this year saw 350 residential projects launched comprising 94,200 units, down 11.16 per cent and 14.36 per cent respectively from the same period of last year.
After several firms saw presales dip below targets in the first 10 months, leading developers plan to launch 121 residential projects worth more than Bt156 billion in the final two months, according to The Nation’s survey.
Supalai plans to launch 11 projects worth Bt13 billion this quarter. Land & Houses plans eight worth Bt11.66 billion; four will be detached-housing projects, and the rest condominiums.
Pruksa Real Estate plans 34 launches worth Bt30 billion, 28 of which will be low-rise projects – detached houses, townhouses and duplexes – and the other six will be condominiums.
“We decided to launch more projects in the last quarter of the year when we saw demand strongly recovering in August and September,” said Prasert Taedullayasatit, Pruksa managing director for condominiums.
Supalai deputy managing director Tritecha Tangmatitham said the company planned to kick off 11 residential projects valued at Bt13 billion this quarter, of which seven will be low-rises and four will be condominiums.
“We saw residential demand start to recover in June when the country’s political stability returned, so we believe that our revenue and presales will achieve the target for this year,” he said.
Ananda Development chief executive officer Chanond Ruangkritya said the company saw demand for condominiums recover in the third quarter and as a result it decided to launch four new condo projects valued at Bt14.95 billion this quarter.
“They will boost our presales to the targeted Bt11.5 billion this year,” he said.
Terdsak Taweetheeratham, senior vice president of Asia Plus Securities, said the top 15 listed property firms planned to launch more residential projects this quarter after delaying their launches in the first half.
According to the company’s research, the top 15 firms plan to launch 243 projects valued at Bt290 billion this year, 40 per cent of which were launched in the first half. Of the remaining 60 per cent planned for the second half, most would be in the final quarter. This is because of stronger demand, he said.
Despite the upsurge in project launches this quarter, the overall property market in metropolitan Bangkok will still drop by about 10 per cent compared with last year. The market fell by 21 per cent in the first half compared with the same period last year.
