Land & Houses to Take a More Cautious 2025 as Weak Q4 Presales and Slower Launches Dim Outlook
A cautious market in the final quarter of 2024 is steering Land & Houses (LH) and its Quality Houses (QH) subsidiary toward a more conservative stance on launching new projects in 2025, according to Kasikorn Securities. The perception of weak fourth-quarter presales has prompted a reevaluation of near-term profitability and growth trajectories for both developers, as the brokerage house weighs the implications of softer demand against the backdrop of a still challenging Thailand housing market. The current view suggests that LH and QH will prioritize inventory management and prudent expansion plans over aggressive rollout of new supply in 2025, especially in the face of subdued demand anticipated in the first half of next year. This broader stance reflects not only the immediate quarterly dynamics but also a longer-term recalibration of targets in a market characterized by fluctuating buyer sentiment, shifting preference for product types, and evolving financing conditions.
LH: Fourth-quarter performance and full-year 2024 results
The fourth quarter of 2024 presented a telling snapshot for LH’s sales trajectory and its ability to translate product launches into robust presales. Kasikorn Securities’ analysts noted that weak presales during Q4 2024 could weigh on quarterly profits, potentially resulting in a weaker performance in 2025 than previously anticipated. The firm estimated LH’s presales at 4.1 billion baht for the December quarter, marking a 52% decline on a year-over-year basis and a 14% drop from the prior quarter. This downbeat quarterly figure came despite LH launching new supply totaling 12.2 billion baht, which was the largest in the year among a total annual supply of 30.8 billion baht. The contrast between a relatively high new-supply level and a weak conversion into presales underscored a fundamental imbalance in demand dynamics, raising questions about the effectiveness of the company’s product mix, pricing strategy, and market reception during the fourth quarter.
The underlying reason for the pronounced drop in presales is identified as the favorable performance of a prior year condo project, which was valued at 15 billion baht and launched in the fourth quarter of 2023. That project had provided a strong spur to LH’s presales in that period, creating a benchmark that could not be easily matched in 2024. In 2024, LH reported presales of 18.7 billion baht, which was 39.5% below the company’s target of 31 billion baht and 18.4% lower than 2023’s 23 billion baht. The annual results continued a downward trajectory that traced back to 2022, when presales were 30.2 billion baht. Taken together, these numbers paint a picture of a year in which LH struggled to translate launches into sales, despite an overall active supply cycle.
The implications for LH’s strategic posture in 2025 are clear: given the disappointing 2024 presales performance and the expectation of weak demand in the first half of 2025, LH is likely to prioritize clearing existing inventory rather than pursuing aggressive new project starts. The expected operational posture aligns with a cautious capital allocation approach, a tighter focus on cash flow generation, and a selective approach to new developments. In terms of earnings outlook, Kasikorn Securities has adjusted its profit forecast for LH downward by a range of 14% to 19%, reflecting both the direct impact of weaker presales and the revised revenue trajectory from future quarters. The downbeat forecast applies not only to LH but also to its subsidiary QH, whose outlook is described as following a similar trajectory, suggesting that the broader group faces synchronized demand challenges rather than isolated issues tied to a single project or market segment.
Within LH’s broader business context, the results invite a deeper look at how the company will allocate capital in 2025. A primary consideration is how to balance liquidity needs with the imperative to maintain a visible pipeline of quality projects that can convert to presales as market conditions improve. The weak end to 2024 places greater emphasis on inventory clearance as a near-term value driver, while any new launches in 2025 may need to be carefully staged, with a stronger emphasis on project scale, location, and product mix that resonates with buyers in a slower market environment. The analyst commentary also hints at a strategic shift away from relying on large, high-profile launches without a commensurate demand base, and toward a more measured recruitment of demand catalysts, such as targeted marketing, favorable financing packages, and potentially more flexible pricing strategies.
LH: Annual 2024 presales, performance, and the gap to targets
Looking at the full-year performance for 2024, LH’s presales totaled 18.7 billion baht, which was significantly below its target of 31 billion baht for the year. The shortfall of 39.5% represents a substantial gap between plan and execution, illustrating the difficulty of achieving aspirational targets in a market characterized by uneven demand and competition for limited buyer attention. The year-over-year comparison reveals an 18.4% decline from 2023’s presales level of 23 billion baht, marking a continuation of the decline that began the year prior, when presales stood at 30.2 billion baht in 2022. These numbers collectively highlight a multi-year trend of deceleration in LH’s presales capacity, which has important implications for the company’s revenue growth, profitability, and ability to sustain a robust development pipeline.
The 2024 results imply a more conservative path for LH in the near term. With presales undershooting the year’s ambitious target and market conditions unlikely to shift dramatically in the immediate future, management and investors may be recalibrating expectations around the pace at which new projects can be brought to market and subsequently monetized. The weaker annual performance is not simply a short-term setback; it signals a structural challenge in converting supply into realized sales, which could influence financing decisions, capital expenditure budgets, and the pace at which LH is willing to pursue large-scale launches in 2025. The anticipated strategy for 2025—centered on inventory clearance and a cautious approach to new launches—reflects a pragmatic acknowledgment that demand fundamentals may remain constrained for the foreseeable future, at least through the first half of the year.
In addition to the presales metrics, the revenue mix from LH’s product portfolio and the evolution of demand across condo and housing segments will continue to shape the company’s earnings profile. The absence of a comparable high-profile project in 2024, following the success of a similar project in 2023, underscores the sensitivity of LH’s presales to the success of flagship launches. As such, management may place increased emphasis on optimizing the performance of existing projects, accelerating the sale of remaining inventories, and ensuring that pricing strategies reflect current buyer sentiment and competitive dynamics. The net takeaway is that LH’s 2024 performance has reinforced the case for a conservative, inventory-focused 2025 strategy, with any new launches likely to be carefully calibrated to align with a more measured demand outlook.
LH: 2025 outlook and strategic implications
Against the backdrop of 2024 outcomes, LH’s 2025 strategic direction appears to be anchored in prudence and inventory management rather than rapid expansion. The anticipated emphasis on clearing existing stock suggests that the company will prioritize cash flow preservation and risk mitigation over pursuing a rapid scale-up in new supply. The cautious approach to 2025 launches will likely involve selective project approvals, a careful assessment of market timing, and an alignment of launch cadences with where demand proves strongest. This approach is designed to reduce the risk of large-scale project cancellations or significant revenue shortfalls if market conditions remain challenging.
From the investor’s lens, the revised profit forecasts contribute to a reevaluation of valuation multiples and risk premiums. A 14-19% downward revision in LH’s profit outlook indicates that the market should expect a slower earnings growth trajectory in the near term, with potential spillover effects on sentiment and funding costs. The alignment of LH’s strategy with QH’s trajectory further reinforces the sense that the near-term earnings narrative for the broader Land & Houses group is tethered to subdued demand and limited upside from aggressive expansion. In this context, investors may place greater weight on liquidity, asset quality, and the ability to monetize the existing pipeline efficiently, as well as the resilience of the company’s earnings from non-real-estate sources, if any.
The broader market environment—where demand appears to be uneven, and the fourth quarter’s results have underscored the fragility of presales—could influence the pace at which LH resumes more ambitious growth plans beyond 2025 if demand conditions improve. The success of any inventory clearance initiative will play a central role in determining how quickly LH can rebuild investor confidence and reaccelerate new launches in a stabilized or recovering market. In sum, LH’s 2025 outlook is dominated by a cautious stance toward new launches, a deliberate emphasis on reducing overhang from existing inventory, and an expectation that profit stability will be achieved through careful project management rather than rapid expansion.
QH: Fourth-quarter performance and full-year 2024 results
QH’s performance narrative in late 2024 mirrors some of LH’s themes but also presents its own distinctive features. Kasikorn Securities notes that QH’s outlook parallels LH, with equity income from QH projected to decline in line with the broader market headwinds and the company’s own sales dynamics. In the fourth quarter of 2024, QH reported presales of 1.4 billion baht, representing a 22% year-on-year increase but a 15% quarter-on-quarter decrease. This mixed quarterly performance underscores the challenging environment in which QH operates, where year-over-year gains can be driven by specific project performances while quarterly declines reflect the cyclicality of demand in a slower market.
In terms of project launches, QH rolled out 6 billion baht in new developments during 2024, which constituted the largest annual launch level for the year and accounted for 61% of the company’s total annual launches of 9.8 billion baht. Yet, despite this concentration of new supply, presales remained muted. The discrepancy between the scale of new supply and the level of presales indicates that the market’s absorption capacity for QH’s new products did not keep pace with the volume of launches, underscoring persistent market weakness and buyer caution during the period. The quarterly improvement in QH’s presales on a yearly basis signals that there were positive drivers in late 2024, but the sequential decline from Q3 to Q4 suggests that momentum did not sustain through the quarter, amid broader market softness and a difficult competitive environment.
For the full year 2024, QH achieved presales totaling 7.1 billion baht, which was 23% below its target of 9.25 billion baht and 5.8% lower than its 2023 presales of 7.54 billion baht. The year 2023 had seen a decline of 8.1% from 2022’s 8.2 billion, illustrating a continued pattern of reduced selling momentum across multiple years. These figures collectively reflect a challenging revenue environment for QH, despite the company’s attempts to drive growth through a substantial launch program in 2024. The mismatch between aggressive launch activity and weaker presales raises concerns about the effectiveness of the strategy in a market where buyers are selective and competition is intense.
The combined implication for QH is a tempered view of growth potential in 2025. The company’s management is expected to pursue a more conservative plan, reflecting the difficulty of sustaining high levels of presales in a subdued market. The outlook indicates that QH will likely reduce the number of new launches in 2025 relative to 2024, and the focus is expected to shift toward products with stronger absorption characteristics—principally low-rise housing—where buyer demand may be relatively more resilient than for mid- to high-rise condo projects. The company’s equity income, which constitutes more than 80% of its profits from the contributions of Home Product Center and Land & Houses Bank, provides some stability in earnings due to the lower volatility associated with these non-real-estate income streams. This structural benefit helps to cushion QH against volatility in its core real estate operations, but it also underscores the long-term strategic importance of maintaining diversified earnings sources within the group.
QH: 2025 strategy and project mix
QH’s 2025 business plan is expected to reflect a conservative stance similar to LH’s approach, with a fewer number of new launches than in 2024. The emphasis is likely to be placed on practical, sustainable growth rather than rapid expansion, aligning with a market where demand remains muted and buyers exhibit caution in committing to large-scale projects. Most new projects are expected to focus on low-rise houses, an area that has shown slower growth compared with condominium segments. The preference for low-rise housing signals a strategic prioritization of product types that may offer more predictable absorption patterns and potentially lower capital expenditure intensity relative to high-rise developments in a cooling market.
The rationale for this shift in product focus stems from observed demand characteristics. Low-rise housing, particularly detached or semi-detached homes, tends to appeal to family buyers who may be more price sensitive in the current climate, or to buyers seeking longer-term housing solutions in stable neighborhoods. However, this segment has historically exhibited more gradual growth than condos, which can dampen near-term sales velocity. QH’s decision to emphasize low-rise housing suggests a deliberate risk management strategy aimed at aligning project characteristics with market demand, reducing the risk of extended inventory periods, and supporting a more predictable cash conversion cycle.
From a profitability perspective, QH’s earnings profile benefits from the exposure to equity income streams from Home Product Center and Land & Houses Bank, which are less volatile than real estate operations. With more than 80% of profits derived from these sources, QH benefits from a degree of earnings stability that can help cushion the cyclicality of its real estate activities. This structural advantage remains a key differentiator for QH relative to other developers with higher proportions of real estate-based earnings. The 2025 plan’s emphasis on fewer launches and a bias toward low-rise housing, coupled with reliance on diversified income streams, suggests an approach designed to balance growth with risk management, while preserving earnings resilience amidst ongoing market softness.
QH: Comparative positioning and risk considerations
When comparing QH to other developers that emphasize low-rise housing in their product mix, QH’s risk profile appears more tempered, thanks in part to its reliance on equity income channels. The fact that a sizable portion of profits comes from the non-real-estate segments—specifically revenue streams from Home Product Center and Land & Houses Bank—contributes to a relatively lower profit volatility profile. This diversification can be especially valuable in a housing market where demand for traditional property development is cyclical and subject to macroeconomic shocks. For investors and stakeholders, this implies that QH may offer a steadier earnings trajectory, even if its real estate pipeline faces headwinds in the near term.
However, the overall environment remains challenging. The headline numbers for 2024 demonstrate that even with a robust launch program, presales did not fully translate into expected revenue, and the targets set by management were not realized. This suggests that market absorption capacity is constrained and buyer sentiment is cautious, a pattern that could persist into 2025 if interest rates, financing conditions, and buyer affordability do not improve significantly. As a result, QH’s strategic emphasis on lower-risk product types and non-real-estate income streams may help in navigating the cycle, but it also underscores the need for careful portfolio management, efficient project execution, and disciplined capital allocation.
The broader implication is that QH’s and LH’s synchronized trajectories reflect a market-wide environment rather than isolated company-specific issues. The group’s response—recalibrating targets, prioritizing inventory clearance, and adopting a measured pace for new launches—appears to be a prudent course in a market characterized by persistent demand softness, evolving buyer preferences, and a need to optimize the mix of products offered. In this context, QH’s focus on risk-mitigating factors such as diversified income streams and a preference for low-rise projects aligns with a balanced strategy designed to protect earnings and maintain financial flexibility while the market heals.
Market context and investor takeaways
The 2024 results for LH and QH occur within a broader market context marked by cautious buyer behavior, an absorption gap after a series of aggressive launches, and ongoing uncertainties surrounding financing and consumer demand. The weak end to 2024, particularly in presales, implies that momentum will need to be rebuilt gradually, and any improvement in 2025 will likely be incremental rather than rapid. The downshift in profit expectations for LH, and the associated similar trajectory anticipated for QH, signal a more conservative earnings trajectory for the group. Investors will be closely watching how inventory clearance efforts unfold and whether the pipeline of launches can be calibrated to align with improved demand conditions later in the year.
Within this framework, LH and QH must navigate several risk factors. Chief among them is the risk that demand remains weak in the first half of 2025, which could keep presales subdued and pressure margins. A second risk relates to financing conditions, including interest rate trajectories and the availability of affordable lending for buyers, which directly affect affordability and appetite for new home purchases. A third risk is the potential for project delays or misalignment between the product mix and evolving buyer preferences, which could lengthen inventory cycles and undermine the efficiency of capital deployment. Finally, while the equity income streams provide some earnings resilience for QH, a sustained downturn in trades or consumer spending could still negatively affect these ancillary income streams, albeit to a lesser extent than the core real estate operations.
From a strategic standpoint, the focus on inventory clearance, careful management of new launches, and a tilt toward low-rise housing for 2025 appears well aligned with the current market realities. The emphasis on prudent capital allocation, risk management, and earnings diversification will be important levers as LH and QH navigate the next phase of the cycle. In addition, the downward revision of profit forecasts by Kasikorn Securities underscores the importance of maintaining discipline around cost control, project selection, and timely monetization of assets. As the market evolves, these companies will need to demonstrate that their strategy can adapt to changing demand dynamics while preserving financial stability.
Conclusion
The fourth quarter of 2024 has underscored a challenging environment for both LH and QH, with weak presales in the final quarter contributing to a more cautious outlook for 2025. Kasikorn Securities’ assessment points to a softer earnings trajectory for LH, with a 14% to 19% downward revision in profit forecasts, a trend that is expected to spill over to QH given the similar market conditions. The data show LH’s Q4 presales at 4.1 billion baht, a sharp 52% year-on-year decline and a 14% quarter-on-quarter drop, despite the company launching 12.2 billion baht of new supply—the largest for the year—out of a total annual supply of 30.8 billion baht. The primary driver of the 2024 presales dip was the standout performance of a 15-billion-baht condo project launched in Q4 2023, with no parallel project in Q4 2024.
For the year, LH registered presales of 18.7 billion baht, which trailed its 31 billion-baht target by 39.5% and represented an 18.4% decline from 2023’s 23 billion baht. The ongoing decline from 2022’s 30.2 billion baht underscores a multi-year softness in LH’s presales performance. With weak demand anticipated in the first half of 2025, LH is expected to direct efforts toward clearing existing inventory while adopting a conservative stance on new launches in 2025. Kasikorn Securities’ downward revision of LH’s profit forecast by 14-19% reflects these realities, coupled with a parallel cautious outlook for QH, which is expected to follow a similar path.
QH’s fourth-quarter presales reached 1.4 billion baht, up 22% year on year but down 15% quarter on quarter, even as the company launched 6 billion baht in new projects—the largest annual total for 2024 and comprising 61% of the year’s 9.8 billion baht launch activity. Nevertheless, QH’s presales for 2024 totaled 7.1 billion baht, 23% below its 9.25 billion baht target and 5.8% lower than 2023’s 7.54 billion baht, which itself marked an 8.1% decline from 2022’s 8.2 billion. In light of these outcomes, QH’s 2025 business plan is expected to feature fewer new launches than in 2024, with a pronounced emphasis on low-rise housing, reflecting slower growth in that segment relative to condos.
The comparative resilience of QH’s earnings, given that more than 80% of profits derive from equity income linked to Home Product Center and Land & Houses Bank, highlights a degree of volatility cushioning relative to pure real estate earnings. This structural advantage helps to temper overall risk, even as the group navigates a market characterized by tepid presales, soft demand, and a cautious investment stance. The combined narrative for LH and QH points to a coordinated, disciplined approach in 2025: prioritize inventory clearance, dial back aggressive launches, lean into the stability of diversified income sources, and pursue selective, market-aligned product strategies that improve absorption while protecting capital.
As the market unfolds, investors and stakeholders will be watching how quickly supply can be absorbed, how effectively pricing and incentives can stimulate demand, and whether the anticipated improvements in the latter part of 2025 materialize. The overarching theme is clear: in a slower market, LH and QH will favor prudent execution, inventory management, and a thoughtful, data-driven approach to launches—an approach designed to sustain earnings while mitigating downside risk in a challenging real estate cycle.