The price of luxury villa resale units in Phuket has doubled because of strong demand and a limited number of units on the market. Top-end villas on the island were part of an exclusive market characterized by a limited number of high-value transactions, Aliwassa Pathnadabutr, managing director of property consultant CB Richard Ellis (Thailand) told The Bangkok Post.
Small foreign developers with limited financial backing use to dominate the market; however, large operators have taken over in recent times. The result has been positive for the market with the switch highlighted by reduced risks for buyers and an improvement in the quality of villas and designs, according to newspaper
Buyers looking to make a purchase in the luxury market face a limited supply despite ongoing demand in the segment.
“In recent years, buyers’ preferences in the luxury sector have shifted towards hotel-branded products that offer quality management, five-star services and facilities as well as the ability to generate rental income,” Aliwassa said. “We’re now beginning to see Western expat groups working in Asia who bought prior to the 2008 financial crisis starting to re-enter the market,”
Even though those groups are coming back, the proportion of completed luxury villas priced above THB35 million with hotel branding remains limited and accounts for less than 10 percent of the villa market in Phuket.
CBRE stated that it expected to see further growth in tourist arrivals as the expansion of Phuket’s airport nears completion. This should have a positive effect on resort property sales in the region. However, the numbers of tourists this year are down and it looks likes number won’t increase until next year.
Andy Kunz, general manager of luxury villa and hotel project Point Yamu by Como, stated 2015 was not proving a good year for Phuket due in part to the number of Russian and other Western tourists had decreases. “Tourism in Phuket has been unfavourable since the coup last year, because Phuket was mentioned in negative ways,” he told the Post.
Image: Point Yamu by Como in Phuket
