SC Asset readies nine launches for Bt11.4 bn
SC Asset Corporation plans to launch nine residential projects worth Bt11.45 billion before the end of this year to boost its full-year presales to Bt16 billion and revenue to Bt14.8 billion.
“We target our sales to grow at double digits a year to achieve total revenue of Bt20 billion in 2019,” said Nuttaphong Kunakornwong, chief executive officer.
In the first half of this year, the company enjoyed a 44-per-cent surge year on year in gross sales to Bt7.49 billion, thanks to the sales performance of horizontal projects worth Bt4.491 billion, up 14 per cent, and condo presales worth Bt3.0 billion, up 137 per cent from the same half of last year.
The company has confidence in the strong recovery of the economy in the rest of this year after the Bank of Thailand revised its GDP growth outlook for this year from 3.2 per cent to 3.5 per cent due chiefly to the expansions of public investment, exports and tourism receipts.
However, private investment and consumption have not picked up as expected. And domestic household debt is still at a worrisome level, handicapping the expansion of real estate development this year.
At the end of the first quarter of 2017, the debt-to-GDP ratio eased to 78.6 per cent, but residential loans increased at a decelerating rate, running counter to housing non-performing loans, which surged 3.2 per cent, prompting banks to be cautious in approving loans and eroding the confidence of consumers, who cannot plan their spending.
In the company’s case, customers’ mortgage loan rejection rate for horizontal projects in the first half of this year was close to the level seen last year at about 10 per cent.
The cash payment ratio particularly in the luxury segment is up 50 per cent – higher than the rate last year.
In short, housing demand continues to percolate but the debt situation affects home-buyer’s ability to borrow money from the future, so customers are likely to spend what they have at the moment, he said.