ESTAR reports first half sales of 500-600 million baht, confident that annual sales will meet the target of around 1 billion baht. The market in the second half is expected to stabilize due to both positive and negative factors.

         Dr. Torsak Lertsriskulrat   Managing Director of Eastern Star Real Estate Public Company Limited (ESTAR) revealed that in the first half of 2017 (January-June 2017), the company achieved sales of approximately 500-600 million baht and is confident that total sales for the year will meet the target of around 1 billion baht. Currently, the company has unsold inventory valued at over 2 billion baht from 8 projects, both under construction and awaiting construction. For the second half of the year and into early next year, the company plans to launch 2-3 new projects with a total project value of approximately 3 billion baht. The company also has a backlog of approximately 1.7-1.8 billion baht in sold products awaiting revenue recognition, which will gradually be recognized as revenue this year, amounting to about 1 billion baht, with the remainder to be recognized next year. Currently, about 90% of revenue comes from condominium products and about 10% from single-detached houses.

          The company has a policy to adjust the sales and revenue ratio from horizontal housing types such as single-detached houses and townhouses, as well as low-rise condominiums, to increase in the future to ensure strong and continuous growth in the company's revenue. However, the company still places importance on the high-rise condominium market. The development of high-rise condominiums takes longer to construct, and it takes time for investment returns to become revenue, so there needs to be development of horizontal housing and low-rise condominiums that are completed and can generate revenue more quickly.

        Dr. Torsak further commented on the overall market in the first half, stating that the first quarter of 2017 was active due to the slowdown in the fourth quarter of 2016. This led to an increase in total sales in the market during the first quarter compared to the same period last year. In the second quarter, condominium projects priced at 100,000-200,000 baht per square meter sold well in prime areas, and the townhouse market also saw increased activity, while the single-detached house market remained sluggish.

         Regarding the market direction in the second half of 2017, developers plan to launch many new projects in the third quarter. It is expected that high-end condominiums will drive the market, as the lower-end market still faces uncertainties due to household debt issues. Overall, the market is expected to stabilize close to last year’s levels and may become active again in early 2018, considering the positive factors expected in the second half, such as GDP forecasts being better than last year, along with exports and mega-projects in the Special Economic Zone (EEC), which will build investor confidence. However, negative factors remain, including household debt issues and purchasing power not keeping pace, as well as NPL issues, Dr. Torsak stated.

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