The market for medium-priced self-built homes slowed in the first five months of the year because of decreasing consumer confidence in the local economy and politics while construction costs rose by 2.19%.
Pramote Theerakul, managing director of Fourpattana Co, said the company’s sales during the first five months were about 200 million baht, below its target of 250 million, as customers in the segment priced from 5-10 million baht a unit delayed making decisions.
“They were not confident in the country’s economy and political situation. Most customers wanted to build a unit as a second home, so they did not hesitate to delay making decisions when they were not confident,” he said.
However, the upper market segment with unit prices of higher than 10 million baht enjoyed good growth as these customers had high purchasing power and were less affected by negative factors. Units priced at 2-5 million baht also showed growth.
“Rising construction costs have an impact on the self-built home market. Unit prices have risen by 2-3% since early this year,” Mr Pramote said.
Construction costs increased by 2.19%, mainly for steel, cement and concrete.
Mr Pramote said the company aimed to achieve 605 million baht in revenue, up by 8-9% from last year, as the second half was usually a hot period. It was in talks with 20 customers for deals to be finalised within July.
In the second half, Fourpattana plans to launch new housing designs with a green concept to cover a wider segment.
It will also join TOA, Cotto, Conwood and Q-Con to hold the Fourpattana Golden Week from June 22-27 at CentralWorld. It expects to achieve 200 million baht in sales from the fair.