Three-storey houses at Baan 365 Rama 3, a high-priced housing project. LPN Development will continue launches in the segment this year.

The condo market is entering a recession and good times are expected only in the first and fourth quarters because of new lending curbs and the general election, says SET-listed LPN Development Plc.

Chief executive Opas Sripayak said the new loan-to-value (LTV) limits will boost sales of ready-to-transfer condos in the first quarter this year, as the new lending regulations take effect on April 1.

"Unsold ready-to-move condos will be a major concern after April 1," Mr Opas said. "The majority of developers' revenue will be gained in the first and final three months of the year. They need to drive sales in those six months for the whole year."

He said the second and third quarters will be a wait-and-see period for the condo market as developers monitor the impact of the new lending curbs. At the same time, there will be the establishment of a new government.

Mr Opas said new condo projects being launched will see a minimal impact from the new LTV limits, as they have a longer period of down payment of 24-36 months, in line with the construction period.

"The condo market showed worse signs two years ago, a time when we slowed down new launches," he said. "The current property situation is likely similar to the period before the 1997 financial crisis. We should monitor it in the next one or two years."

According to the company's market research, the amount of new condo supply launched in Greater Bangkok over the last few years totalled 70,000 units a year and the average sales rate was 60%.

But last year the sales rate dropped to 50%, and the amount of unsold supply rose.

Mr Opas said the low-rise housing market will continue its strength this year because buyers reflect real demand and some have shifted from condos to townhouses or single houses as their family expanded.

"Thai people, if possible, usually choose a low-rise house," he said. "When transport networks or mass transit lines expand citywide, homebuyers will turn to low-rise houses."

LPN aims to increase presales from low-rise houses to 5.5 billion baht by the end of 2019. Last year the total grew by 130% to 3 billion baht.

LPN reported 1.36 billion baht in net profit on revenue of 11.3 billion baht last year, up 12% and 17% respectively. The company targets 16.5 billion baht in revenue for 2019.

Of the 2018 revenue, 10.18 billion baht was from property for sale, 933 million baht from management fees, 132 million baht from rental and services and the rest from other items.

LPN shares closed yesterday on the Stock Exchange of Thailand at 7.50 baht, up 20 satang, in trade worth 104.7 million baht.