Ever since Phuket was first ‘discovered’ in the mid eighties as a tropical Asian destination, property has been booming on the island and it’s some of the most expensive real estate in Thailand out side of Bangkok.
The jetset, Bangkok businessmen and expats wanting to spend all or part of their year here all want a piece of Phuket. Add to that investors, property and resort developers and small time businessmen and you realise there’s quite a lot of competition for limited sea views. If you can settle for something inland there is plenty of room for everyone, and plenty of local real estate agents in Phuket to serve your needs. There’s also dozens of projects offering fantastic retirement or investment villas, some of which go for a million dollars, with a steady stream of buyers.
Prime real estates in the popular areas like Patong, Kata and Kamala were snapped up years ago by Thai entrepeneurs, and are largely given over to resorts and commercial use, while private villas and other property in Phuket is continually under development on the fringes and headlands, such as Kalim Bay near Patong or above Kamala or Surin beaches. Then there is the Laguna complex of Bang Tao which was an area of ex tin-mining quarries which were reclaimed into pretty lagoons and five star resorts.
Those wishing to make a home in Phuket who can’t afford to compete with the millionaires who are snapping up property around the new purpose built marinas, can opt for housing developments inland, such as Chalong near Phuket Town. Others opt to build by themselves in traditional neighbourhoods, which is the cheapest option but fraught with challenges. The East coast, which has very few beaches is far less developed and an area many real estate developers in Phuket are looking towards, such as Koh Siree peninsula east of the town.
Buying villas in Phuket
Property is booming on Phuket and the development of villas are all the rage. There are a variety of villa rental plans that make buying villas in Phuket is appealing to overseas investors whether they holiday in Phuket frequently or not.
While you can find some villas for sale that allow the buyer to stay for an unlimited number of days per year, most of the newer villa developments have been constructed with investment returns in mind. Buyers of these Phuket villas can stay on average 30, 60 or 90 days per year in their villa, although you should beware of villas that restrict the time of year the owner can stay. The rest of the year is turned over to a villa management programme and rented out to holidaymakers. Any unused days can also be given up for rental. This works well for those who holiday on Phuket but do not plan to stay long-term.
Having your own villa in Phuket can ensure you have a relaxing holiday every year, as you are treated as a guest and entitled to all the same amenities as someone renting these villas. However, instead of paying to stay, you’ll be making money when you’re away. Some these villas and developments even guarantee a specific percentage rental return for a number of years when you purchase.
It is important for foreigners thinking of buying villas in Phuket to look into the structure of the development they want to buy. Almost all villa developments in Phuket cater to foreign investors and representatives can thoroughly explain the legal aspects of a purchase, which you should also have checked by a lawyer familiar with Thai law. In many cases where villas are set on individual land plots, the villa developer holds the title to all the land. Foreigners can purchase apartments freehold (‘chanote’ title) but in the case of villas you will most likely be restricted to leasehold (30 years max with two extensions of 30 years each) or be required to purchase through your own Thai company.
When selecting or buying villas in Phuket, you should examine the background of the developer, architect and construction companies carefully. Some developers have come to Phuket to make quick cash and may have cut corners. Many developers have never even done a project before coming to here. Don’t believe that all buildings are constructed to Western standards. Unfortunately guild ethics are promoted here in Thailand and the country does has somewhat of a reputation for lack of transparency and honest dealings among certain business people. The law is rather lose, and offenders can buy their way out of trouble. Invariably, as a foreigner you will at a disadvantage and many have been cheated in the past without fair support from the local courts. It’s very much a ‘buyer beware’ place.
Additionally, you should take a good look at the rental management programme and facilities. Will they ensure your property remains kept-up and desirable? What will they do to keep your villa rented out as much as possible? If the management programme is not professional, you may wind up with more headaches than rental returns.
Location is another key factor when looking at buying villas in Phuket. For instance, while you may want to buy something on the east coast because you value a quiet holiday, you must consider if that outweighs the possible requirement renters might have to be near to facilities and west coast beaches.
If you think there is a chance that you may want to stay longer than the allotted time at your villa, it might be better to buy an apartment or house, or look for Phuket villas that allows year-round occupation by the owner. Some villas developments are charging very high prices for a place you can only stay in part of the year, and you need to determine if you will see a return on your investment. Remember, you can always give over a house to an agent to rent out while you are away.