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June 16, 2010
Q4 2009 saw a continued recovery in the Phuket property market. Sales of resort property improved but were still at low levels and mainly concentrated in a limited number of projects.
The level of built but unsold inventory of completed condominium and villa units is low.
Prices for built property have remained relatively stable with few examples of forced sale situations.
Purchasers are cautious and are focusing on projects promoted by known developers where there has been visible construction progress. We believe that demand is recovering.
The total supply of completed resort condominiums was 2,681 units at the end of Q4, an increase of 9% Q-o-Q and 30% Y-o-Y. Five Condominium projects were completed in this quarter. The single unit type that accounts for the largest proportion of Phuket’s completed condominium supply are two-bedroom units in entry-level projects.
No new condominium projects were launched in Q4 2009.
We estimate that 13% of completed resort condominiums have not been sold.
During Q4 2009, the average asking price of condominiums being marketed was THB 86,755/m2.
Villa
The total supply of completed villa projects was 3,472 at the end of Q4. There were 13 villa projects completed in this quarter.
As expected, completed units have the highest sales performance, with 76% sold. 58% of villas in projects under construction have been sold. We estimate that there are 372 units that are under construction still available for sales.
The average asking price of luxury villas being marketed was THB 124,110,000.
Outlook
Overall Phuket has come through the combination of the global financial crisis and Thailand’s political problems relatively unscathed.
The opportunity and challenge is for developers to identify target markets and create properties that match those requirements. Potential buyers will be more cautious and will want to be confident about ability of developers to deliver product both in terms of their financial resources and development expertise Phuket Villa Sales - Read full report
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June 11, 2010
The Thai market has historically shown it can weather crises without damage to investors.
The ‘Red Shirt Protests’ that turned parts of Bangkok’s shopping and financial district into a barricaded fortress for more than 2 months is unlikely to lead to dramatic drops in property values, although some people have deferred buying decisions for the time being, reveals a study by a company well known for its research.
The reason is because the property market has been dampened by political uncertainty for the last five years.
Those who have followed the pattern of property values during periods of political uncertainty in Thailand will have noticed that prices rise in good times but hold and do not drop in bad times, with steady growth again after the situation improves.
One exception was real estate prices did drop dramatically during the 1997-98 Asian economic crisis, when real estate prices did drop dramatically. But it has to be explained that these plunges took place among secondary grade properties and not prime ones, whose values held up.
The impact of the recent protests, in the opinion of most people living in Thailand, both Thai and foreigners, will be short-lived
So all in all we are still seeing substantial confidence in the Thai property market.
Turning to the resort markets, the study shows that there was no evidence of a drop in value in Phuket and Koh Samui as existing foreign owners of property on the two islands are choosing to hold on to their assets.
The fundamentals of the resort markets are that they are predominantly foreign markets with purchases made with surplus funds. Since there is no financing available to foreigners to buy property, almost all purchases are 100% cash.
Looking at Phuket, most of the buyers are sitting on positive financial gains on their investment and there is no direct pressure to sell. So generally speaking, people only sell when they have made substantial profit. This means there is generally little stock on the market at any one time.
In fact, it has been the global financial crisis that has had the prime influence on the resort markets and this has led to the cancellation of many developments. While big Thai companies have launched major projects in Phuket in recent years, quite a lot of the developments have been foreign-led, although some of these projects have been quite small.
From our experience we have seen a reduced volume of sales but prices are still recording substantial gains for those few sellers in the market.
Despite the recent problems, Thailand is still a top resort destination. And although good prospects in emerging markets such as Cambodia have been reported over the past couple of years, there is no stock of quality resort properties there today.
To see the full report, click here.
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While Thailand’s tourism recovers from political demonstrations in the capital Bangkok and some northern provinces, which saw governments advising their citizens not to travel to Thailand, the paradise island of Phuket, 900 km south of Bangkok, has received a major accolade. Phuket was voted ‘Best Asian Maritime Capital’ in the annual Asian Boating Awards 2010 hosted by luxury magazine Asia-Pacific Boating.
Yachting, whether sailing or power boating, is one of Phuket’s best-kept secrets. But probably not for much longer as word of this magical cruising area spreads. Compared to more established yachting destinations in other parts of the world, the waters and small islands around Phuket are unspoiled and little traveled. Deserted beaches and otherwise inaccessible ‘treasures’ await those who explore by sea.
MyPhuketInfo.com supports Phuket’s high value/low impact yachting tourism with page after page of detailed information and images on every aspect of boating holidays in Phuket, including day trips, sailing yacht charters, speed boat tours, sport fishing and yachting events.
Demonstrating the resilience of this branch of tourism, all the while tourists were shying away from Thailand, fearful of becoming embroiled in the protests, the Top of the Gulf Regatta went ahead in Pattaya, while the Koh Samui Regatta maintained similar entries to last year and interest in Phuket’s own forthcoming Six Senses Phuket Raceweek was gathering pace.
As Phuket’s local travel guide, MyPhuketInfo.com is an invaluable source of independent information on the growing number of charter boats plying Phang Nga Bay just off the north of Phuket, as well as the countless pristine islands and beaches to the south. Each year, the number and quality of boats available for charter - many of them built in Phuket itself - expands, with operators departing from all points on the island.
For the adventurous traveler who wants an escape from the hustle and bustle of Phuket’s major tourist beaches, there is nothing to beat taking to the water in search of Greater Phuket’s real paradise.
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 It is no secret to us here, on the ground in Thailand, that the coverage of the ‘Red Shirts’ protests in Bangkok by the international media, especially by CNN and BBC was very poor and very biased. They made it look like these protest were an up-rise by the poor rural people from the north and north east of the country, against the so called ‘elite’ from Bangkok, and were demanding democracy and equal rights. However, nothing could be further away from the truth!!
‘Democracy’ was used as a façade, a mask, to hide the true intention of the ‘Red Shirt’-leaders to organize these protests: to cause mayhem, trying to bring the Abhisit government down, by such paving the way for new elections, so that the real ‘brain’ behind the protests, their paymaster, convicted and fugitive criminal Thaksin Shinawatra, who is living in self imposed exile to avoid a 2-year jail sentence after being found guilty of corruption while in office as Prime Minister, could return to power if ‘his’ party was to be voted back in power. By ‘buying’ enough votes, an illegal, yet very common practice by Thaksin’s party ‘Pheu Thai’, his return to Thailand and power, and white wash of all his crimes would have been assured.
That the poor and uneducated people from the rural north can be fooled by such demagogue practice can be understood. And these people could very well use the 500 to 2,000 Baht a day they were being paid to attend the protests. A fact that can be proven by many videos that can be found on ‘You Tube’, but ignorantly ‘forgotten’ to be mentioned by most international media.
What is more difficult to understand is how even European leaders could fall for this nonsense? Below I have summarized the major points made during the European Parliament session on 20th May:
1) This conflict is about the red shirts versus yellow shirt government supporters.
Now, this is where they are already wrong. No, it is not red versus yellow. The People’s Alliance for Democracy (PAD) supports Sondhi Limthongkul and the New Politics Party, which isn’t a part of the coalition government. They haven’t done anything in this crisis other than sit on the sideline talking tough and making threats. They condemned the government’s handling of the situation at every turn.
2) There is mass censorship. All media has been blocked.
No, wrong again. Only the red media has been blocked. And for a very good reason. It was calling for violence, arson and terrorist attacks like bombings, burning Bangkok, killing the Prime Minister… Would not any other country in the world shut down media that is inciting violence?
3) The government should have applied the road map.
Yes, and they intended to. But how could they? The UDD (Red Shirts) turned down the road map. Somebody (CNN and BBC) forgot to report that part.
4) All citizens should enjoy a free election.
Ah, finally, here they are correct. At least, partly. Because… all Thai citizens were about to enjoy a free election, on 14 November this year to be precise, as proposed by Prime Minister Khun Abhisit as part of his road map. Initially, the UDD (Red Shirts) agreed to accept that offer. But after talking with the paymaster in exile (Thaksin Shinawatra) they changed their mind.
5) They spoke out against Emergency Law.
Bombings and shootings in the streets, the two months long occupation of the major business and shopping district of Bangkok, causing millions in damage daily, making people losing their jobs, people went out of businesses, attempting to take over ThaiCom, the communication lifeline of the country… Was none of this reported by the international media in the months prior to May 19?
Please see below links to ‘You Tube’. I feel that the links give a very good account and feedback to what has been going on here in Thailand and the way forward, as presented by the Prime Minister Abhisit to an International delegation.
1. http://www.youtube.com/watch?v=q4-hEoESykk
2. http://www.youtube.com/watch?v=PHsE6uLQYA0
3. http://www.youtube.com/watch?v=oL1GBht7vvY
4. http://www.youtube.com/watch?v=56XUERrfUQI
5. http://www.youtube.com/watch?v=oju0Dt9VjXA
6. http://www.youtube.com/watch?v=ptBf5fFVKk4
7. http://www.youtube.com/watch?v=SVbj0vOQ9qM
8. http://www.youtube.com/watch?v=Fr8DLa13vOE
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May 28, 2010
When the news was out that clashes had erupted between troops and the red-shirt demonstrators in Bangkok, many tourists worldwide ignored their government’s warning to reconsider vacationing in Thailand.
Most travelers may be avoiding Bangkok, if not Thailand in general. But still many visitors appear to be insulating the tropical resort island of Phuket from the effects of the recent violence. Indeed, the island’s comparative prosperity shows how shifts that transform the global economy, can also supply visitors to an attractive destination so steadily that it becomes relatively immune to temporary disturbances. Their nationalities simply change.
Consider the Australians: in recent years, increasing exports of iron ore, copper and coal from Australia to booming China sent the Australian dollar soaring, pushing down the cost of imported fuel and, with it, airfares. That in turn helped to put Phuket within reach of more and more Australians, with airlines responding with more direct links.
As a result, Phuket now attracts more Australian tourists every year than it does from any other country. That means that with just over 22 million people, Australia sends more people to the island than countries like Japan and South Korea that are not only more populous but much closer.
Scandinavians, whose currencies have rocketed upward recently as the euro has dived, have also been coming in increasing numbers, along with tourists from oil-rich Russia and the Gulf.
All of which is good news for an island whose economy is dominated by the export of sun-kissed beachgoers. Tourism accounts for an estimated 70 percent of all jobs on Phuket, representing a $3.15 billion industry that has helped turn it into one of Thailand’s wealthiest provinces.
So business owners and officials here have been understandably anxious about whether Phuket might suffer as tourists heard advice from their embassies to avoid Thailand altogether. Last week, Phuket’s governor, Wichai Prisangob, published an open letter reminding travel agents and airlines that no anti-government “red shirt” demonstrators had been spotted on the island.
Tourism officials in Thailand estimate that the recent protests in Bangkok could cut the country’s tourism revenues, which are already under pressure of the global economic crisis, by almost one-fifth this year. Hotels in Phuket, however, have reported only a slight increase in cancellations. ‘We have had some impact, but not as much as in Bangkok’, said Somboon Jirayus, president of the Phuket Tourist Association and a 20-year veteran of the island’s travel industry. Mr. Somboon’s family owns two hotels on Phuket. But room cancellations are one thing and airport arrivals are another. The number of international arrivals into Phuket last month (April) increased by 41.4% over April 2009.
The negative effect of the global economic crisis on tourism in Phuket actually pales in comparison with what happened late December 2004, when the tsunami hit the resort island and surrounding provinces, killing about 5,400 people, of which only 250 on the island. In the year after the disaster, tourist arrivals to Phuket were cut in half.
Perhaps the most lasting effect has been on Phuket’s popularity in Taiwan. Before the tsunami, Taiwan was to Phuket what Australia is now, supplying more visitors than almost any country. Only two Taiwan visitors were killed in the disaster, yet visitor numbers from Taiwan dropped off afterward and have never recovered, according to statistics from the Thai Ministry of Tourism and Sports.
But Phuket seemed to become only more attractive to Swedes, even though Sweden lost more citizens to the tsunami than any other country. More than 500 Swedes died because of the Tsunami. In 2006, as the dollar sank against Scandinavian currencies, Swedes began pouring back into Phuket, becoming one of the biggest groups of visitors to the island.
Nowadays, Scandinavians are offsetting a shrinking number of visitors from the countries that share the rapidly declining euro.
Russians are another fast-growing source of new arrivals, as evidenced by an increasing number of restaurants and shops here sporting signs in Cyrillic lettering. Rising oil prices and a climbing ruble have brought down the cost of heading to the tropics during the depths of the Russian winter.
Thailand’s tourist industry is quick to exploit new markets like these. After Russians first started coming to the country in sizable numbers in 2006, the Tourism Authority of Thailand opened an office in Moscow to promote the “Land of Smiles.” Now, Russians represent the fifth-largest group of visitors to Phuket, with more arriving each year than from the United States and Canada combined.
Mr. Somboon says the Phuket Tourist Association is currently aiming to promote the island to tourists in that other emerging economic powerhouse: India. Phuket is vying to host the annual Tourism Association of India meeting later this year to give it greater exposure to the subcontinent’s travel industry.
But Phuket’s popularity seems to have more to do with its relative cost to a country’s travelers than with their economic strength.
One country that is still underrepresented in Phuket, for instance, is China. While the number of mainland Chinese visiting Phuket grew rapidly during the global economic boom, they have since fallen relative to other groups and, in the last year or two, have actually declined.
Australia has been a particularly strong source of reinforcements. Not only was it one of the few non-Asian nations to avoid a recession during the financial crisis, but it has the added advantage of being in the Southern Hemisphere. That means that when Australians decide to escape their winter for sunny Thai beaches, it is summer in the Northern Hemisphere, which is typically Phuket’s low/green season.
Some Australians say Phuket’s popularity is a reaction to a terrorist bombing in Bali in 2002 that killed 88 Australians. Others say it is a simple question of cost.
Australian arrivals in Phuket did not start to surge until the Australian dollar did in 2004, along with commodity prices. Then, in late 2006, Jetstar Airways, the budget subsidiary of Qantas, began offering direct flights to Phuket.
A round-trip ticket from Sydney to Phuket can run as low as 930 Australian dollars, or $739. The surge in Phuket’s popularity coincided with a wider boom in low-cost airfares from Australia abroad. “In 2009, for the first time since about 1983, outgoing passengers outnumbered inbound,” said Peter Harbison, managing director of the Center for Asia Pacific Aviation in Sydney.
Australians who switched to Phuket from Bali seem to prefer its greater level of development and its more freewheeling style.
“Here’s more of a big town,” one visitor from Adelaide said as he downed a lunchtime tequila at the Kangaroo Bar. “I’ll never go to Bali ever again.”
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May 26, 2010
Due diligence is the name given to the process of investigating the details of a potential investment, including the verification of material facts. Wishful thinking, on the other hand, is an interpretation of the facts as one would like them to be rather than as they are.
If you regularly visit online expatriate forums, you will read plenty of stories about people who bought property in Phuket, or anywhere else in Thailand, and afterwards found themselves with big problems on their hands. Which approach do you think most of those investors took when they decided to buy their property?
In fact, many people buying real estate in Phuket appear to exercise less due diligence than they would when purchasing a property in their home country. There are a number of reasons for this. One reason is that decisions are sometimes made in haste due to the time constraints of overseas trips. Alternatively, difficulties and misunderstandings can easily arise when trying to evaluate and negotiate purchases from a distance. Another reason is the language factor, which makes doing your homework just that much more difficult. The intoxicating allure of a foreign country and the fact that Phuket property for sale is relatively inexpensive can also result in caution being thrown in the wind.
Thailand is unique in many ways and it does have its share of problems. But it is not an inherently bad place in which to invest in real estate. It is, however, surely a bad place in which to be a lazy, poorly-informed or inept investor.
There are a number of factors you need to be aware of before committing to any real estate purchase (or long term lease) in Thailand. These include:
- The nature of land titles in Thailand (if you propose to buy or lease land)
- The legal framework that determines how foreigners may (or may not) own or control land, buildings or apartments/condominiums in Thailand.
- Current market conditions such as sales price (both asked and achieved) for both new and older property, rental prices, time taken to sell or rent and
- The fact that in Thailand there can be a huge difference between what is written in the rule book, what you will be told by various people involved in the process, and what actually happens in real-life.
Information concerning the first point can easily be obtained by some research over the internet. You can simply use a search engine to identify relevant pages within, for example, the websites of Thai law firms. This material will give you a good basic knowledge about the subject. Some websites also provide English language translations of relevant Thai laws. If you are interested in condos rather than houses or villas, you might want to locate and study the relevant sources such as the ‘Condominium Act’ which was amended in 2008 to give the buyers more protection.
Reliable information on the second point is more difficult to find, as the topic is complex, the information sources more dispersed, and there is a great deal of misinformation in circulation. Again, a good starting point is the websites of the more reputable Thai law firms AND reputable real estate agencies in Thailand.
Generally speaking, the only real estate in Thailand that can be owned by foreigners is certain condos or buildings built upon land owned by a Thai. These controls on foreign ownership are a major constraint on real estate investment in Thailand and are not about to be liberalized any time soon. Many foreigners seek loopholes or alternative means of acquiring or controlling real estate, but most of these methods feature an element of risk or uncertainty and some are even illegal.
Some of the procedures more commonly discussed in the media or online include:
- Buying through a Thai company
- Buying land in the name of a child
- 30 year leasehold
- Buying land in the name of a Thai spouse with various protections in place such as usufructs, leases, or mortgages
Obtaining accurate real estate market information is equally problematic and takes a great deal of determined searching. There is information out there, but it is neither integrated nor particularly user friendly. Much of it also tends to address only limited segments of the real estate market.
With regards to the last point, many people who are new to the process and idea of buying property in Thailand and just started their research, bemoan the fact that they are having difficulties in obtaining a clear and precise answer to their questions. These people have to understand and realize that this is not Europe or Australia but Thailand and that there often is no precise answer. This is not to say that research is pointless, but it does not mean that you must develop a certain level of general knowledge and then exercise your own judgment.
As well as information that is specific to real estate investment, it is also recommended to spend some of your time to inform yourself about other related issues. What is the best way to transfer your money to Thailand, how to select a bank and open an account and the nature of Thai tax regulations. Factors such as these can have a significant impact on the cost of your investment.
To conclude all the above, I am sure you can agree that you better not go the distance on your own, but that you should get assistance from reputable, experienced professionals.
We here at ‘Tropical Properties’ – Real estate, can assist you with all the above matters.
Source: www.property-report.com
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Over the many years I have been in this business here in Phuket, I have met with hundreds of property investors. All of them have their specific requirements and taste. And all have their own specific reason for investing in property in Phuket. Still, although everyone is different, has different taste and different requirements, there are still some basics that all need to keep in mind when selecting the property you find the most suitable to invest in.
These are some insights I gathered over the years dealing with these investors that I want to share with you:
Good Location
I know it will sound like a cliché, and I have to admit, it is. But when it comes to making your choice when buying a property, especially when you are buying for investment purpose, be it here in Phuket or anywhere else around the world, it is all about location, location, location. When you are buying a property to live in it yourself, location may be a less significant factor as one may have different preferences in where to live. Some like to live in a quieter location, away from the resort areas and tourists. These people are probably more interested to buy a Villa in Rawai, or an apartment/condominium in Nai Harn. Others will choose to be close to the action with easy access to shopping, nightlife… These people are very likely to be more interested in a property on the west coast of Phuket, be it a house in Patong or a luxury ocean view apartment in Kamala or any other resort area close to the island’s beaches. Proximity and accessibility to schools, airports and hospitals are some other important factors to consider for some. Even when buying to live in the property yourself, it is important to also consider how other people will view the location and even to try to think ahead about how the area might develop and will look like in the years to come. After all, you may one day decide to sell the property. So it is advised to try to be as objective as possible when it comes to deciding on the location.
Is the property located in a good development? Is the area around it already built-up or what could be built there in the future? How about the drain or power cables? Is it close to the main road? How far is it situated from the beach? When choosing the location of the property, these are some of the points to consider when thinking about what will appeal to your potential buyers in the future.
Good Property layout
If you are buying an existing property (i.e. a property that is already 100% completed or a resale), it is important to consider if you are satisfied with the layout of the property. Many of our many clients over the years like to have an open plan living area as this makes the room look and feel more spacious. As we are living in Asia and many of these buyers have spent a significant part of their live in the region, many of them are also taking the ‘Fengshui’ into consideration. If there are many angles and corners in the house, that property will not suite them. But in any case, a good layout will save you time, effort and money in having to redesign the property layout to suite your needs and taste the most. If you are buying a property ‘off plan’ or while it is still under construction, most of the times the developer will be flexible enough to make the necessary changes to the layout to fit with your taste and requirements, as long as that is structurally possible.
Good History
If you are buying a resale property, it might be good to know the history/background of it. Why are the current owners looking to sell? Is the current owner living in the property or is it rented out? These things are important in the making of personal and economic decisions.
Profitable Investment
If the property is for investment, with the intention to generate a good rental return, the potential buyer should also get the information about the expected rental returns or, if it has a history of lettings, the proof of the returns. Does this match with what other properties in the area are generating in rental returns? Then you need to consider if this is acceptable for you.
Another point that needs to be considered when the purpose of the purchase is mainly investment is the expected capital appreciation. What is the average price for similar properties in the same area and how are these prices compared to what they were about 5-10 years ago?
Sometimes it will not be easy to get a straight answer to this as in many areas of the island, 5-10 years ago, there was almost no development of the scale and quality we now have.
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March 25, 2010
Thai business aircraft operator MJets has opened the country’s first dedicated fixed-base operation (FBO) at Bangkok’s Don Mueang airport to exploit the growing demand for business aviation throughout the South-East Asian country.
According to flightglobal.com, the executive lounge includes showers, a business centre for passengers and pilots, and flight planning and pilot briefing facilities.
“The business jet market in Thailand is growing. In addition to the jets that we have, several local tycoons and air charter companies are interested in buying more jets or trading up to a bigger aircraft. A variety of aircraft are being purchased in Thailand,” says MJets spokesman Navdeepak Vaid.
MJets is also keen to set up an FBO on Phuket Island, one of Thailand’s premier holiday destinations. It was not immediately clear where that FBO would be located, but Phuket International Airport is the only facility in the province with a runway capable of handling jets. The only other runway currently on the island is the 500-metre grass strip at the privately owned Phuket Airpark in Paklok.
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Patong Mayor Pian Keesin has launched an ambitious plan in a move aimed at preventing a repeat of the flooding that deluged Phuket’s premier resort town during last year’s rainy season.
He said he guaranteed that the four projects underway would be completed before the rains start this year.
Khun Pian is not guaranteeing that there will be no more flooding in Patong. But at least, the situation should be much better compared to last year he said.
One project aims to prevent the return of the so called ‘Nanai River’, a 50-meter stretch of Nanai Road which was under about half a meter of water for most of last year’s wet season.
The area that got flooded varied with rainfall but generally reached from the Aroonpat Village housing estate to the Chang Residence Hotel.
Around 200 meters of drainpipe will be laid along the side of the road in order to allow the floodwater to run into the nearby Pak Lak Canal.
Mayor Pian said a tender process for the four-million-baht project was currently underway.
The whole construction should not take more than two months, according to Khun Pian.
Another area that was the site of flooding last year is the canal besides the Patong Hospital. There, two pumps have been installed inside the canal last week.
Khun Pian explained that the pumps would speed up the passage of water through the canal.
In a third project, drainpipes are being laid underneath the new road running behind Jungceylon.
One section, which was completed on Wednesday, will direct water from behind Jungceylon, under the road and past JJ Market Phase 2.
A second section, which is now underway, will direct water from the same place to Patong’s wastewater treatment plant.
“Laying another line will double the water drainage” Khun Pian explained.
Finally, Pak Bang Canal will be dredged and widened to increase the amount of water it can direct into the sea.
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February 8, 2010
As Phuket’s low season is coming to an end and the high season is fast approaching, the island’s property industry has their fingers crossed for a pick-up in business. The signs are looking very positive.
Passenger traffic to Phuket is increasing as flight traffic is also on the rise. Direct flights from Perth by Virgin Blue are expected to begin in November. This is on the back of an earlier announcement by Virgin Blue that they intent to start with direct flights to Phuket from Brisbane and Sydney as well.
Increased flight frequency is also expected from some regional airlines and Air Asia recently announced they want to make Phuket their regional hub.
All this is welcoming news for the upcoming high season which officially starts on the 1st of November.
The island’s hotel industry is also in an increasingly optimistic mood. Advance bookings are on the rise with some hotels reporting 100% occupancy over Christmas and New Year.
Some questions are raised, however, on how long the 2009/2010 high season will last.
Phuket’s high season, in terms of accommodation rates, traditionally runs from 1st of November until 30th April. With the global economy getting back onto its feet, expectations of a boost in hotel bookings and activity on the island is justified, although some feel this much needed boost may slow down towards the end of February 2010.
So what does this mean
for the real estate in Phuket?
According to a recently published mid-year report, the first half of 2009 saw a total sales of nineteen Phuket luxury villas with a combined value of 3,5 billion Baht. There remain a total of ninety-two unsold luxury villas in Phuket with a total value of 10 billion Baht. The report defines a luxury villa in Phuket as being priced at 65 million Baht or above.
With only a few new developments of properties in Phuket being launched over the last 12 months, and many developments already started having slowed construction, the Phuket property inventory is no longer growing at the same pace experienced in the previous 24 months. This bodes well for established and financed developers.
As tourists start to return to the island and the Phuket real estate market is picking up, the Phuket properties that are already completed or nearing completion and those well established in the market are likely to see an increase in sales as new launches are expected to remain low.
However, to paint the Phuket property market with a single brush would be ignorant to the product segmentation. Area, price and product (Phuket villas, Phuket condominiums, foreign freehold, leasehold…) create mini-markets within the Phuket property market with each segment having it’s advantages and challenges and success stories to report.
The fundamentals of the Phuket property market remain the same. Its attractions and infrastructure, and the easy access and central location within Asia remain strong selling points. The relatively low cost but yet high standard of living only adds to the positive factors.
All this combined with the expected increase in air traffic and the already strong advanced hotel bookings makes that the Phuket real estate market is looking set for a very strong high season.
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