Of Pruksa's inventory worth Bt54.03 billion, between Bt1.5 billion and Bt2 billion is accounted for by completed homes ready for sale, with the rest consisting of undeveloped land and a backlog that will be transferred to buyers when construction is complete, he said.
"Having a high inventory does not mean our residential projects cannot be sold, because it combines our undeveloped land, under-construction residential projects, many of which have been sold and will be transferred when the projects complete, and ready-to-occupy homes, which are waiting to be sold," he added.
However, the managing director accepted that some of a developer's inventory, especially homes ready for occupation, could be a burden if sales proceeded more slowly than stock built up.
This is especially true for condominiums, because once a condo project commences construction, it is not normally possible to suspend the development process.
If sales fail to meet the target, construction will continue and the developer has to shoulder the construction cost until the project is completed, while having to wait for income to be generated from the project, he explained.
Meanwhile, detached housing and townhouse projects do not face the same problem, because the developer can suspend construction if sales fall below the estimated level, he added.
Nonetheless, most residential developers have tried to reduce their inventory, especially for condominium projects, after witnessing slower growth or a drop in demand.
For example, Sansiri has suspended new condominium launches in the latter part of this year after seeing a fall in demand, and is solely focusing on the development of condominiums under a joint venture with BTS Holdings Group.
Early this year, the company also suspended development of the Base Central Udon Thani, which was launched in 2013, after demand fell below the estimated level.