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Wednesday, July 24, 2024

Phuket Real Estate Market Surges Beyond Pre-COVID Levels

Phuket’s real estate market is experiencing an unprecedented boom, surpassing pre-COVID levels, with a reported 500 active projects valued at 470 billion baht ($12.8 billion USD) in the first quarter of 2024, according to the Agency for Real Estate Affairs (AREA). This surge is largely driven by the high demand for vacation homes and condominiums among foreign buyers, priced between 20 and 100 million baht each.

Dr. Sopon Pornchokchai, Chairman of AREA, revealed in a recent survey that Phuket’s real estate market saw an investment of 54 billion baht ($1.47 billion USD) in low-rise houses and condominiums during the first quarter of 2024. This has resulted in 500 active projects on the island, significantly higher than the pre-pandemic period of 2020.

The survey indicates that out of 72,000 units available for sale, 62,000 have already been sold, leaving 10,000 units on the market. Phuket’s Gross Provincial Product (GPP) was estimated at 110.648 billion baht ($3 billion USD) in 2023. The island also recorded an influx of 8.37 million tourists, a 152.29 percent increase from the previous year, solidifying its status as a premier global destination.

The survey highlighted that Thalang District is a key area for residential projects, accounting for 50 percent of them, with 32,000 units, 25,000 of which are sold. In Mueang District, there are 190 projects with 28,000 units, and in Kathu District, 70 projects with 12,000 units. These projects encompass a variety of properties including single-detached houses, twin houses, townhouses, shophouses, condos, and vacation homes or villas.

Dr. Sopon noted that of the total 470 billion baht worth of active projects, two-thirds are vacation homes and condominiums, while one-third are regular residential properties for Thai buyers. Key statistics from the survey include:

  • 130 vacation condominium projects with 27,000 units worth 210 billion baht, costing an average of 7.7 million baht per unit, with 4,500 units remaining.
  • 149 vacation home projects with 3,300 units, averaging 36 million baht per unit, with 1,200 units remaining.
  • 50 general condo projects with 17,000 units worth 40 billion baht, averaging 2.4 million baht per unit, with 1,300 units remaining.
  • 85 single-detached house projects with 6,700 units worth 39 billion baht, averaging 5.7 million baht per unit, with 1,100 units remaining.
  • Twin houses, valued at 23 billion baht, average 3.5 million baht per unit, with 500 units remaining.
  • Townhouses have 100 projects with 10,000 units worth 27 billion baht, averaging 2.7 million baht per unit, with 700 units remaining.

The average price for houses and condominiums in Phuket stands at 6.4 million baht per unit, with regular residential properties averaging 3.5 million baht and vacation properties at 10.7 million baht per unit.

Dr. Sopon further detailed property prices:

  • Single-storey houses: 5-7 million baht, followed by 7-10 million baht.
  • Semi-detached houses: 3-5 million baht, followed by 2-3 million baht.
  • Townhouses: 2-3 million baht, followed by 3-5 million baht.
  • Shophouses: 3-5 million baht, followed by 5-7 million baht and 7-10 million baht.
  • General condominiums: 2-3 million baht, followed by 1-2 million baht.
  • Vacation condominiums: 5-7 million baht, followed by 3-5 million baht and 7-10 million baht.
  • Villas or vacation homes: 20-40 million baht, followed by 40-60 million baht and over 100 million baht.

In Mueang Phuket district, Thai buyers predominantly purchase condominiums, with 10,000 units worth 26 billion baht, an average of 2.6 million baht per unit, with 500 units remaining. The monthly sales rate is 8.1 percent, projecting a complete sell-out within a year.

Kathu district focuses on vacation condominiums, with 4,000 units worth 28 billion baht, of which less than 100 units remain. In Thalang district, the total project value is 290 billion baht, with vacation condominiums and houses accounting for 86 percent. New projects launched in Q1 2024 include 25 projects with 4,000 units worth 54 billion baht, primarily vacation condominiums in Thalang district.

Dr. Sopon reported that land prices in Phuket have surged by an average of 7.47 times or 10.7 percent per year over the past 20 years. Rawai Beach saw the highest increase, followed by Bang Tao Beach and Mai Khao Beach. The highest land prices are in Patong Beach, estimated at 350 million baht per rai, significantly higher than the government’s estimates.

Ongart Suwankul, Senior Vice President of Condominium Development at Sansiri Public Company Limited, stated that 2024 marks the 40th anniversary of Sansiri. The company has invested in Phuket for 15 years, with 21 projects worth 21 billion baht. Sansiri plans 16 new projects worth 15 billion baht by 2027.

Sansiri is set to pre-sell “Canvas Cherng Talay” in Bang Tao, valued at 1.6 billion baht. Krit Tachasamma, Managing Director of Origin Nationwide Company under Origin Property Public Company Limited, announced successful investments in Phuket, including the pre-sale of “Origin Resort World Phuket Bang Tao Beach” valued at 8 billion baht. Origin plans to invest 13.75 billion baht in Phuket this year, focusing on residential projects and hotels.

The “Origin Resort World” project aims to offer comprehensive mixed-use developments in tourist cities, combining contributions from various companies within the Origin group.

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