More than 80 percent of Phuket condo sales during the first six months of 2018 were at projects offering rental guarantees.
These condo sales were also priced at less than THB 5.5 million.
This is according to real estate firm CBRE in its latest market report focusing on activity during the first half of the year.
It reported that just 458 condos and 56 villas were sold during the first six months of 2018.
For condos this represented a 5 percent increase year-on-year but for villas it was a 46 percent drop over the same period during 2017.
Phuket property sales were focused on investment-orientated or income-producing products for both villas and resorts condos.
CBRE said that investors preferred Phuket resort condos because of the cheaper lump sum price combined with rental management schemes.
Despite the island’s past reliance on foreign buyers, especially those from China, Hong Kong, Singapore and Russia, it noted that the Residences at Sheraton Park Grand Bay is one project that has been successfully attracting Thai buyers.
This, is said, was a combination of branding, seas view units, price and location.
CBRE predicted there will be more hotel-branded residential developments as branded management has become a more sought-after criteria for investment buyers because of rental guarantee schemes.
Sales in the Phuket luxury segment, above THB 90 million for villas and above THB 20 million for condos, were limited but CBRE said that it remained confident that there is still interest in this sector.
One villa, at the Andara Signature Villa Hills, sold for more than THB 200 million earlier this year.
CBRE concluded by suggesting that the Phuket resort property-for-sale market will continue to be dominated by investors in the low-end price segment.
It said there is an opportunity for higher-priced products, and that the challenge for Phuket property developers is to create the right product to make buyers’ needs.
CBRE said that it believes growth in tourist arrivals to Phuket will also continue to be a key driver of demand for both the residential and hotel markets.
“The challenge for the Phuket market is to decrease reliance of the Chinese and Russian tourists, to reduce the risk from any downturn in these two key feeder markets,” it added.