Monday, March 19, 2007

ERA foresees good year for second-hand home sales


More interesting and up-to-date articles can be found at www.property-bangkok.com

ERA foresees good year for second-hand home sales

20/02/06
KANANA KATHARANGSIPORN

The property brokerage firm ERA Franchise (Thailand) Co aims double its business in the second-hand home market with a turnover of five billion baht from sales of 2,000 units by the end of 2006.
President Voradet Sivatachanon (for-merely known as Kosintr Komen), said the second-hand home market was a promising sector. Although the world economy was likely to experience a slowdown, buyers of second-hand homes still wanted to spend.
“The rising cost of construction materials and a shortage of labour have no impact on the second-hand home market,” he said. “The only two factors affecting it are war and closure of financial institutions.”
The company expects to achieve cumulative sales of 20 billion baht within three years with seven billion and eight billion baht in 2007 and 2008, respectively. Its average unit price last year was 2.63 million baht, down from 2.95 million in 2004.
Mr Voradet said the market this year would have the same trend as the new housing market. A large proportion of buyers would look for lower-priced homes, focusing on the medium-priced segment of 3-5 million baht a unit.
“the average price this year will be 2.5 million baht a unit, lower than last year when higher-priced units had good sales in 2005.”
He added that units in popular areas will not drop below this average as very cheap houses were mostly located quite far away from city centre.
The company last year recorded turnover of 2.5 billion baht from 950 units, lower than the expected three billion baht from 1,000 units. The largest segment remained townhouse, accounting for 36.3%, followed by single homes at 29%.”During June and July last year, we were not in operation as we’re-engineered the organization including office relocation, a team reshuffle and shareholder change,” said Mr Voradet.
The company’s former shareholder, Innovation Capital Co, a subsidiary of Shin Corporation Plc, sold its 76% stake in the company to Mr Voradet last year.
Currently, the company has 555 branches in 11 provinces. It expects to have 12 corporate franchises and 500 individual franchises by the end of 2006.


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