FIVE OF the top 10 listed property firms plan to launch new residential projects worth more than Bt100 billion in total over the remainder of the year on the back of low interest rates and energy costs and strong demand, especially for homes valued at more than Bt10 million.
The rosy outlook comes at a time when the economy is struggling.
The property giants also revealed their revenue and net profit figures for the first half of the year, and they make for pretty reading despite rising household debt.
Pruksa Real Estate recorded revenue of Bt21.76 billion and net profit of Bt3.05 billion, up 15.7 per cent and 4.2 per cent respectively on the same period last year. Sansiri announced revenue of Bt17.13 billion and net profit of Bt1.44 billion, up 47 per cent and 5.88 per cent respectively.
SC Asset Corporation booked Bt5.93 billion in revenue and net profit of Bt658 million, up 37 per cent and 11.1 per cent respectively.
AP (Thailand) recorded Bt10.73 billion in revenue and net profit of Bt1.2 billion, an increase of 13.42 per cent and 23.7 per cent (see graphic)respectively.
SC Asset chief executive officer Nuttaphong Kunakornwong told a press conference that the company's revenue and net profit grew because of strong demand for luxury homes priced over Bt10 million.
Based on the demand in this market segment, he said the company planned to launch five new residential projects worth Bt8.8 billion in total in the second half of this year. He said the company had maintained its presales target of Bt13.9 billion and revenue target of Bt13 billion for the year but had raised its land-purchase budget to Bt7.5 billion in total after acquiring land in Chidlom for Bt1.9 million per square wah (Bt475,000 per square metre) this month.
"We increased our land-investment budget when we saw a business opportunity. to drive our revenue to Bt20 billion in 2019," he said.
Pruksa Real Estate president and CEO Thongma Vijitpongpun said the company had maintained its revenue target at Bt47 billion this year after recording presales and revenue of Bt23.93 billion and Bt21.76 billion respectively in the first half.
Thongma said the overall value of the housing sector this year would reach Bt337 billion, a 15-per-cent increase on the Bt293 billion last year.
He added that the sector would continue to grow by 5-7 per cent over the next 10 years thanks to an increasing population and despite the average land price increasing by 10-20 per cent per year. In the first half of this year, the company posted growth in all areas for a Bt3-billion net profit.
He is confident of achieving this year's target of Bt47 billion in revenue.
"The company will continue looking for new investments in the second half of the year and in 2016. We are considering building bigger projects that are more valuable because landpurchasing negotiations are more difficult these days," he said.
Sansiri president Srettha Thavisin said homes priced over Bt5 million were particularly attractive.
He said low interest rates were the main factor boosting demand, aided by low energy costs.
These were the positive factors that drove property-market growth in the first half of this year, he said.
Anuphong Assavabhokhin, chief executive of AP (Thailand), said the property market in the first six months was stronger than in the same period a year earlier because of the country's political problems in 2014.
He said most of the company's con-dominium projects that were sold in 2013 would be transferred to the buyers this year. "We continue to have confidence that the market will keep growing over the rest of this year and estimate the overall market growth at 5-10 per cent. As a result, the company plans to launch 15 new residential projects worth Bt24.02 billion over the rest of this year," Anuphong said.