The promotion of real estate in Phuket continues

The growth of the tourism sector is boosting real estate sales on Phuket Island. This rebound in Phuket's real estate market is expected to continue for at least two more years thanks to strong growth in the tourism sector.

President of the Phuket Real Estate Association Fattanan Phisutwimol said foreign buyers, especially Russians fleeing war and Germans seeking refuge from the energy crisis, were the main driver of the property market recovery. "They arrived in such large numbers that the rental housing units were fully occupied," he said. "The luxury villas were in high demand, especially those near Laguna, which were particularly popular with Russians, Chinese and Europeans. "

According to Mr. Fattanan, Russian buyers purchased half of the pool villa project, while other groups bought pool villas to rent out to their compatriots. The Real Estate Information Center (REIC) said the number of newly sold villas in Phuket increased more than four times last year, from 34 units in 2021 to 149 units in 2022. In the second half of 2022, 129 villas were sold, compared to 131 for the whole of 2019.

Phuket ranks third in the country in the number of apartment sales to foreigners after Bangkok and Chonburi. Last year, the island saw 637 apartment sales to foreigners worth 3 billion baht, up 85 percent and 53 percent from 345 sales worth 1.95 billion baht in 2021. The 2022 numbers also exceeded pre-pandemic sales, with 476 apartments worth 2.37 billion baht sold in 2018 and 505 apartments worth 2.5 billion baht in 2019.

"The number of apartments sold in November and December 2022 was 30% higher than before the pandemic," said Mr. Fattanan. "This momentum is expected to continue over the next two years as the tourism sector makes a strong comeback." According to REIC, Phuket's tourism sector revenue soared to 139 billion baht in 2022, increasing more than 10 times after dropping to 13.1 billion baht in 2021. This is a significant improvement from revenue of 87.5 billion baht in 2020, which fell from 393 billion in 2019 and 425 billion in 2018, according to the center.

"The recovery of the tourism sector has had a strong impact on the growth of housing demand in Phuket, with a good degree of sales in all residential property categories in the second half of last year," said Vichai Viratkapan, acting general director of REIC.

Despite a thriving tourism industry and rising income, many local service workers are still unable to get mortgage loan approval due to insufficient financial documents and savings, Mr. Phattanan said. "Many people with real demand can't get a mortgage or make a down payment because their savings were depleted during the pandemic," he said.