Demand continues to rise, albeit at a slower pace, for luxury residential offerings in right locations throughout Thailand; and Phuket is the place to be.
The economic slowdown in Thailand has affected the residential property market in 2019 prompting some foreign investors to look for greener pastures in the neighbouring countries with brighter prospects. Nevertheless, some residential developments in key cities around Thailand are still achieving and maintaining high occupancy rates even in the slowing market: very prominently, projects that offer a variety of unit types located in strategic locations or vacation destinations are continuing to enjoy popularity even in the face of a slowdown. Excelling projects are maintaining interest from investors by offering a relevant unit mix and maintaining competitive building conditions, while also incorporating more family-friendly features to keep them competitive.
Adapting to Changing Conditions
New project launches in Bangkok have been able to sell out quickly in Q3 of 2019 by setting the selling prices lower than the market prices and focusing on selling different types of products to meet the diverse lifestyles of the buyers. Unsold units remain the main concern for developers at present, according to Colliers Quarterly Q3 October 2019 report and, to whet the appetite of the prospective buyers, developers of older projects with unsold units have also been offering special promotions to lower the unit prices and push the sales.
According to Tim Skevington, managing director of Richmont’s, affiliate of Christie’s International Real Estate, despite the softer market this year in Thailand, the overall pricing trend remains positive. “We find that savvy buyers are taking advantage of current uncertainties to negotiate discounts or other benefits such as free furniture packages, or reduced property transfer and management fees,” explains Skevington.
Foreign buyers, as a substantial target group for the large developers, continue to show interest in projects along the train lines that are currently under construction in Bangkok, as evident from the sales rate of the newly launched condominiums in Q3 2019. Grade A apartments in the Central Lumpini and Sukhumvit areas, all of which feature a variety of unit types and offer a full suite of facilities, continue to enjoy popularity with strong 98 per cent occupancy rates.
“Second-home buyers in Thailand have traditionally looked at resort areas but we see more buyers looking to Bangkok, particularly at the lifestyle branded residences that have recently been completed on the Chaopraya riverfront,” attests Skevington. “Buying a second home with five-star facilities and management included particularly appeals to owners looking to reduce the fixed costs of a landed resort property.”
Hot Vacation Market
Having experienced strong population growth (7.4 per cent annually) and growth of tourism at a staggering pace, the influx of new residents is buoying Phuket local economy, particularly the residential property sector. Among the arrivals to the island, there are more visitors from China than from any other country, with people and capital from China being the key driving forces in the tourism and property sectors. Russia and India are also not too far behind, with direct flights between these countries and Phuket facilitating hassle-free travel.
Investments in the infrastructure of Phuket are showing yields in the island’s economy and fuelling the appetite of investors in the residential market. The expansion of the Phuket International Airport has led to an increase of new arrivals, while new entertainment projects have diversified the island’s appeal beyond its beachfronts.
The island of Koh Samui has long been on the radars of discerning travellers as one of the world’s most popular destinations, rivalling Phuket as one of the most desirable locations in Thailand to invest in residential property. A lucrative attraction to Koh Samui, beyond its pristine beaches, is the island’s relative affordability of residential property coupled with its untouched natural beauty, as a greater part of the island is protected by the government by stringent planning and environmental laws to maintain the natural beauty of the island.
Premier residential real estate has always been in high demand on Koh Samui, attracting a high number of affluent visitors to the island. With over 150 luxury hotels and spa resorts, Koh Samui’s transformation into an up-market holiday destination has also affected the real estate market where prices have increased dramatically over the last several years. Nevertheless, even in the face of price increase, Koh Samui still holds tremendous investment opportunities as compared to other Asian destinations. As far as luxury property rental market goes, Koh Samui’s value becomes even more apparent, with its rental yields of 8 to 10 per cent being among the highest in Asia.
Nai Harn Baan Bua Tree Villa (Villa Phuket)
Located in the southern part of Phuket, Villa Phuket epitomises the concept of a “home in a garden”, set against a tropical backdrop and within private and convenient access to Nai Harn beach. The villa’s interiors feature high ceilings and floor-to-ceiling windows that maximize the connections to nature outside.
Handmade built-in furniture throughout enhances the bespoke quality of the development, while the lavish greenery around reinforces an unforgettable feeling of being within a lush tropical garden.
Listed by: Richmont’s
Price: approx. USD 1.4 million
Radisson Phuket Mai Khao Managed Residences
The Radisson Phuket Mai Khao Managed Residences faces the gleaming, azure Andaman Sea – perfect to make it your vacation home. Just 10 minutes away from the international airport, you enjoy the views of the northwest side of Phuket if you travel by car. This dreamy property will allow you to enjoy the sunsets and balmy breeze. With beachfront gems such as these becoming a scarcity, it’s a wise investment to consider. The freehold property offers modern amenities and the units will be fully furnished, equipped and decorated by the Radisson Hotel Group. Indulge in some “me time” such as outdoor pool, state-of-the-art fitness centre, kid’s club, sauna, steam room, rooftop swimming pool, lounge and a host of F&B options ready at your doorstep. Every unit will enjoy unfettered sea views and guaranteed 6 per cent yield for the first three years. Read about other luxury properties in Phuket here.