Property agent Capital One Real Estate Co is expanding to second-hand homes, joining American property franchise Keller Williams to tap the 100-billion-baht market with a goal to share at least 5 billion baht.
Vit Kultanavipas, chief executive of Capital One, said the second-hand home market is on the rise as unit prices can be 50% lower than new units.
"For Sukhumvit Soi 36, a condo unit at a new project is priced as high as 300,000 baht per square metre, while a second-hand unit is priced only 170,000 baht," he said.
Capital One wants to diversify as the launch market was sluggish last year.
In 2019, Capital One recorded flat growth in sales of new units at off-plan condo projects where it was the sales agent, recording 9 billion baht.
Sales from Thai buyers rose 30%, while the amount from foreign buyers dipped 50% because of the stronger baht. Thai buyers usually account for 60%, said Mr Vit.
Last November, the company signed a 20-year franchise agreement with Keller Williams, the largest real estate franchise in the US, and set up KW Thailand Co to operate the second-hand home business through a franchising system.
"Keller Williams has innovations to facilitate real estate agents and a profit-sharing system to generate passive income for agents," he said.
KW Thailand expects to have five market centres by the end of the year before adding up to 30 over the next five years.
A market centre is a property brokerage firm under its franchising system.
The company aims to have 1,000 individual agents in the first year.
Mr Vit, also KW Thailand's chief executive for regional operating principle, said KW Thailand set a sales target of 5 billion baht by the end of 2020.
Of the amount, 90% will come from second-hand units and the rest from new projects.
KW Thailand has 3,000-4,000 second-hand units in Bangkok with a total sales value of 10-12 billion baht.
At the same time, Capital One is sales agent for 15 condo projects worth 20 billion baht and expects to sign sales agent deals with 7-10 new condo projects.
As Capital One has overseas offices in Hong Kong and Shanghai, the company eyes a franchise agreement with Keller Williams for the Hong Kong market.
Founded in 2004, Capital One plans to enter into property development business for first time this year.
Next month, the company will debut with 150 units of town houses and duplex houses worth 300-500 million baht near Suvarnabhumi airport.
"Unit prices will be 3 million baht and lower as we want to capitalise on the government's property tax incentives with a cut of transfer and mortgage fees to 0.01% from 2% and 1%, respectively," said Mr Vit.
"Those incentives ended on Dec 24, 2020."