New research has shown that the Phuket condominium market is expected to see higher prices in line with improving economic conditions.
This prediction from real estate firm Knight Frank is in line with current market conditions which, according to agents and developers on the island, have seen a dramatic pick-up in activity during the past months.
Knight Frank notes that increasing supply will be a key driver, but we note that currently supply is exceeding demand by hundreds of units per quarter.
If this continues for the remainder of 2018, we believe that Phuket will face a possible oversupply situation. Developers need to monitor this situation closely.
In its research, Knight Frank said that demand across the market will continue to be driven by international homebuyers, investors, and expatriates, especially those from Mainland China, Russia, and Australia.
It also reported an expectation to see a larger portion of buyers from South Korea.
Average asking prices per sqm are anticipated to rise in all areas, while increasing demand for luxury condominium units may see prices approaching new highs in 2018, especially those properties located by the sea.
One factor that is expected to help boost the Phuket property market is the Phuket Smart City project that aims to develop the province in terms of Smart Economy and Smart Living Community.
It also aims to see the city as the hub of digital industry in the region, and one that will attract investors and tourists.
The project is expected to be complete in 2020.
Across Phuket, average asking prices per sqm fir all new projects launched during 2017 rose to THB 135,719 per sqm, up 2.5 percent year-on-year.
The Phuket condominium market is predominantly driven by foreign buyers, especially those originated from Mainland China, Russia, and Australia.
These buyers tend to buy for own occupation or long-term capital appreciation, despite the fact that a property purchase in Thailand does not entitle the owner to any form of long-stay visa in the vast majority of cases.