Phattanan Phisutvimol, a former president of the Phuket Real Estate Association, said residential demand in Phuket among foreigners has been overwhelming since 2022 and reached a peak last year, thanks to the revival of the tourism market, reports the Bangkok Post.
“The hottest segment is luxury, with units priced 10 million baht and higher,” he said.
“In addition to villas, which foreigners need to purchase through a leasehold contract, many condo projects reached the maximum foreign quota, requiring foreigners to opt for leaseholds."
According to the Real Estate Information Center (REIC), the number of residential units in Phuket leased long-term, typically from three to a maximum of 30 years, tallied 985 units worth B12.8bn last year, growing 54% and 180%, respectively, from 638 units worth B4.57bn in 2022.
The skyrocketing growth in value was a continuation from 2022, when it tripled from B1.45bn from 322 units in 2021. The segment was valued at B1.5bn from 311 units in 2020.
Russians dominated among foreign nationalities opting for a leasehold property in 2023, both in terms of units and value, accounting for 53% and 44% respectively.
Last year, the value of leasehold properties purchased by Russians surged to B6bn from B2.52bn in 2022, while the number of units rose by just 32% to 591 units from 447 units.
This indicated Russians bought more higher-priced units, including “super-luxury” villas, according to REIC.
Among the top 10 nationalities purchasing residential units in Phuket under a leasehold contract, Israelis were 10th last year and ninth in 2022 in terms of unit numbers.
Singaporeans were among the top five nationalities in terms of value the past two years, though they did not make the top 10 prior to that. The value of their leasehold purchases jumped from B230 million to B1.64bn last year, representing the largest gain among the top 10.
Chinese were No.2 in terms of number of units purchased, surging from 21 units in 2022 to 245 units in 2023, while the value rose by 4.6 times to B2.57bn from B550mn.
“Chinese prefer freehold property ownership rather than leasehold. Their increase in leasehold properties last year was attributed to a lack of available condos, as foreign quotas were filled,” Mr Phattanan said.
He said the boom in tourism in Phuket not only benefits foreign demand for property there, but also those working in the hospitality sector, as Phuket is likely the only province where potential homebuyers of units priced B3mn or less recorded a low rejection rate.