SET-listed developer SC Asset Corporation plans a more cautious approach to strategies and business plans this year, likely reducing residential project launches from last year as a substantial glut remains.

According to Kasikorn Securities, SC plans to adopt conservative strategies and business plans in 2025, with the value of new project launches decreasing from 2024.

Last year, SC launched 17 new residential projects worth a combined 31.8 billion baht, as planned earlier in the year, compared to 22 projects worth 36.7 billion baht launched in 2023.

Presales in the fourth quarter of 2024 tallied 6.8 billion baht, bringing the total presales for the year to roughly 25 billion baht. This figure fell short of the 28-billion-baht target set earlier and was lower than the 27.9 billion baht achieved in 2023.

However, Kasikorn Securities expects SC to achieve double-digit profit growth in 2025 and make 2 billion baht, from 1.75 billion baht last year, driven by revenue deferred from 2024 and the increased transfer of condo backlogs expected in 2025.

Revenue should also increase from the commercial operations of two new hotels: KROMO Bangkok, Curio Collection by Hilton with 306 rooms near Sukhumvit Soi 29, and The Standard Pattaya Na Jomtien.

SC chief executive Nuttaphong Kunakornwong said 2024 was a particularly challenging year for the real estate sector, especially for residential properties, due to three main obstacles.

"High household debt, reduced consumer confidence, and oversupply -- these issues typically appear in isolation or in some years but rarely all at once. 2024 was one of the few years when all three converged," he said.

Since the global financial crisis and the pandemic, Thailand's household debt has grown by over 5% annually, while GDP failed to reach that level of growth. The pandemic acted as a short circuit that broke this pattern, Mr Nuttaphong said.

In terms of confidence, the bank rejection rate for homes priced above 10 million baht exceeded 10% for the first time, reaching 15-20% at certain points. This was unprecedented, as market confidence completely eroded.

"Customers are hesitant to complete transfers even when their financial health allows it, while banks are reluctant to issue loans," he said during the seminar, "KKP Year Ahead 2025: Opportunities Unbound" held by Kiatnakin Phatra Financial Group (KKP) this week.

He added that market confidence had been further undermined. Despite a decline in defaults, the frequent rescheduling of bond maturity dates continued to reduce trust in the market.

"In years when a particular segment or product performs well, developers tend to rush into that category, resulting in an oversupply," said Mr Nuttaphong.

In 2022-23, the market saw a significant oversupply of single detached houses priced at 10 million baht and above, as many developers entered this segment. In 2022 alone, the new supply of low-rise houses surged by 80%, a substantial increase.

"Even when sales are robust, the market remains oversaturated," he said. "During periods of strong absorption rates, it typically takes a few years to clear the supply. Currently, it takes over four years. It may take at least three years for the market to fully recover."