The first-quarter net profits of 10 publicly listed residential property developers in Thailand dropped to 3.56 billion baht in Q1 2025, marking the lowest level in more than a decade, according to a report by Kasikorn Securities, as subdued demand and economic sluggishness continued to pressure the sector.
The report from Kasikorn Securities attributed the sharp downturn in profits to a combination of falling revenues and thinner operating margins. First-quarter earnings declined by 38% compared to the same period last year and were down 51% from the previous quarter.
Sorapong Jakteerungkul, senior vice-president at Kasikorn Securities, noted that this significant drop in profitability reflected the diminished scale of operations. “When top-line revenue declines, the ratio of selling and administrative costs increases, leading to reduced operating efficiency,” he said.
The average quarterly net profit of the sector over the past five years stood at 8.3 billion baht, with some quarters reaching 12–13 billion baht. In contrast, Q1 2025 earnings amounted to less than half that average.
The developers included in the analysis were AP Thailand, Britania, Land & Houses, L.P.N. Development, Origin Property, Pruksa Holding, Quality Houses, SC Asset Corporation, Sansiri, and Supalai.
Despite the overall decline, the report identified a modest recovery in housing gross margins compared to Q4 2024. This improvement followed a period of aggressive discounting, when many developers slashed prices in an effort to finalize transactions before the expiration of reduced transfer and mortgage fees.
Developers have responded to prolonged oversupply and waning demand by exercising greater caution. In Q1 2025, the combined value of newly launched projects totaled 44 billion baht, while presales reached 54 billion baht. Firms also reduced land acquisitions and construction to better manage liquidity and reduce financial exposure.
Debt levels among these companies improved, with both interest-bearing debt and the net debt-to-equity ratio falling year-on-year and quarter-on-quarter. Still, these adjustments have not been enough to offset weak demand, with Q1 profits accounting for only 15% of full-year projections.
Kasikorn Securities forecasts a 15% year-on-year decline in developers’ full-year earnings for 2025, driven by persistent market softness. While property incentives, more lenient lending rules, new project launches, pricing tactics, and possible interest rate cuts could lend some support, none are expected to fully counterbalance the broader economic headwinds.
Additional income may come from an increase in condominium backlog transfers in the remaining quarters, offering some relief. However, annual profits are likely to remain below long-term averages, the report concluded.
Attending industry observers noted that Thailand’s residential property sector continues to grapple with macroeconomic uncertainty, with many developers adjusting their strategies to weather ongoing challenges.
