Phattanan Phisutvimol, President of the Phuket Real Estate Association, highlighted that tourism is the primary source of income for Phuket, which has shown signs of recovery in 2022 after the impact of COVID-19. Nonetheless, the region is facing several challenges, including rising material and labor costs, as well as the effects of the LTV policy. This policy has reduced the purchasing power of Thai buyers, leaving them with insufficient savings to invest in property. Consequently, the real estate market in Phuket is currently reliant on foreigners and Thai citizens who have stable jobs and purchasing power.
Phuket's real estate market currently faces a challenge as the registered population is just over 400,000 in 2021-2022, Before that, the number of unregistered population was around 700,000, totaling more than 1 million people. However, the impact of COVID-19 has led to a drastic decline in the unregistered residents to only 100,000-200,000 people, which is inadequate to meet the labor demand, leading to intense competition and rising labor costs. On the other hand, the tourism industry shows a positive trend, with an estimated 10 million visitors expected this year, a figure close to pre-COVID-19 numbers. This group holds significant purchasing power, indicating a potential boost to the economy.
Based on the data from licensed housing estate projects in Phuket at the conclusion of 2022. In 2021, developers requested licensing for 1,095 units, though they actually built fewer than 20% of them. In 2022, there were 823 readied and authorized units for both hotel and residential developments. This year, it is estimated that the number will surge to over 1,000 units, possibly approaching or even surpassing pre-COVID levels, due to a significant number of developers from central regions investing, particularly in condominiums.
The figures for real estate transfers in Phuket indicate that in 2019, 4,398 units were transferred. In the two years following the COVID-19 outbreak (2020-2021), this number declined by 40-45%. However, in 2022, the figure rebounded to 4,163 units, nearly returning to pre-COVID levels. This suggests that the situation is improving, but not yet fully recovered. Some of the transfer figures come from foreign buyers - mainly from Europe, Russia, and Germany - who establish companies in Thailand and purchase properties under the name of Thai spouses.
The demand for real estate in Phuket, particularly for condominiums, has been on the rise since mid-2019. From May to December, there was a 30% surge in demand, leading to a significant increase in registered condominium units, which now total 28,000. The transfer volume graph indicates that the number of condo unit transfers has caught up to the number of registered con units. As a result, many condominiums are now sold out or off the market, leaving only resale unit options available for purchase.
Phuket currently has about 4,000-5,000 condominiums for sale in the Chinese market that have not been registered. This is due to construction delays and the subprime crisis in China, which has led to Chinese customers withdrawing their reservation deposits and developers being unable to complete construction as the construction began only in the third quarter of last year. It is expected to take some time before registration of the condominiums increases, possibly starting in April-May. Once the backlog is cleared, it is expected that more Chinese investors will come in to inspect and transfer ownership.
At present, there is a relatively high demand for condominiums in Phuket, especially in tourist areas like Patong where there are no new condominium projects. Most of the available options are resale properties, and many developers have recently entered the Phuket market. Companies like Origin, Sansiri, and Asset Wise have invested in developing luxurious pool villas and working together with local partners.
This year is considered as the golden year for real estate in Phuket, and it will continue into next year. The demand for condominiums and pool villas has surged, resulting in a shortage of supply. This is due to the fact that people are buying properties in Phuket as second homes and as high-yield investments to take advantage of the economic recovery.
Language
Price display
