By SOMLUCK SRIMALEE
However, the financial results of the top 10 were better than those of the overall property market, for which revenue dropped by about 9 per cent, according to a survey by the Real Estate Information Centre (REIC) of Government Housing Bank.
Five of the top 10 recorded growth in revenue and net profit in 2016.
They were Land and Houses, Supalai, Property Perfect, SC Asset Corporation, and Ananda Development. Four of them, Pruksa Holding, Sansiri, Quality Houses and LPN Development, reported declines in revenue and net profit. AP (Thailand) reported lower revenue but still managed higher net profit than in 2015 (see graphic).
Lower demand to buy homes in the final quarter of last year was the main factor hitting full-year revenue and profit, several property developers said.
“Our revenue and net profit were lower than our estimate after we were unable to conduct any marketing campaigns in the final quarter of last year. This had an impact on our overall financial results for 2016, as the last quarter is the high season for sales in residential projects,” Pruksa Holding’s president for premium business, Prasert Taedullayasatit, said recently.
Outlook for 2017: 5% growth
However, most of the top 10 listed property firms are confident the market this year will grow by more than 5 per cent thanks to a stronger economy. The government forecasts growth in gross domestic product of more than 3 per cent, and state spending on infrastructure projects should drive the demand for homes.
Based on this positive outlook, the top 10 plan to launch a total of 224 residential projects worth a combined Bt314.73 billion, and most of them target double-digit revenue growth this year.
One of these is Pruksa Holding. Chief executive officer Thongma Vjitpongpun said the company foresaw strong demand for homes from now through 2022 thanks to the government’s investments to develop the country’s infrastructure projects, a programme worth more than Bt2 trillion over that period.
“The property market, especially residential demand, will grow strongly after the country’s mass-transit expansion. This is the major reason our sales will amount to Bt100 billion five year from now,” he said.
Meanwhile, residential prices this year look like rising by 3-5 per cent because of higher land prices and interest rates. However, Pruksa estimates that the overall property market this year will grow by at least 5 per cent as people who delayed their home purchases last year finally take the plunge, Thongma said.
Sansiri president Srettha Thavisin is also confident that demand to buy homes will grow strongly, especially from foreign investors interested in purchasing luxury homes in Bangkok and tourist destinations such as Phuket and Chiang Mai.
“We target our sales to foreign buyers to reach Bt7.5 billion this year thanks to strong demand in this market segment,” he said.
The REIC forecasts that new residential projects will launch up to 108,000 units into the market this year, up 12 per cent from 2016.
The centre also expects 180,000 residential units to be transferred to buyers this year, up 3 per cent from last year. In terms of value, Bt466 billion worth of homes will be delivered to buyers, up 5 per cent from last year.