Phuket is bursting at the seams to accommodate a boom in
property development of all sorts. The Travel Thailand
Network,
www.travelthailand.com
goes
to an expert source in order to provide information
to its visitors that may be considering Thailand or
Phuket as a source of property or real estate purchase
for whatever reason.
Travel Thailand’s Bill Fogarty spoke recently with
Larry Cunningham, CEO of Phuket One Real Estate about
the benefits and possible pitfalls of property purchases
on Thailand’s biggest and most popular tourism destination.
TT.
“Well Larry first can you tell us who can buy property
on Phuket. Is it for example possible for a foreigner
to buy land and build property?”
LC
“Basically there are two methods; one is to lease
the property for 30 years with options to extend for
up to 90 years. The second is to form a Thai company
which would own the property on behalf of the owner.”
TT
“So it is not possible for a foreigner to actually
own the land outright. Is it then possible for the
foreign buyer to buy a dwelling in a condominium outright?
LC
“ On some parts of the island yes, on other parts
no. Make sure whatever agent you choose is well versed
on the laws in whatever area of Phuket you are looking
at.”
TT.
“Phuket has a reputation as being relatively expensive.
Does that hold true for the entire property market?”
LC.
“ No. Phuket property is still very affordable! New
apartments can be purchased for as little as $US 90,000.
At the other end of the spectrum though, sea view
mansions can sell for more than $US ten million. It
is also interesting to note that we have a lot of
new properties now around the $US 60,000 level.”
TT.
“ Who actually is buying Larry? Where do most purchasers
come from?”
LC.
“Folks from all over the world, actually. Most are
from Europe in fact just around the 60% mark. This
represents a significant change, as previously the
market was driven by expats, most living and working
in Hong Kong. However these people represent just
around a 25% market share at writing. It also
seems that many more are selling their properties
in Spain and buying in Phuket. The probable reason
is that Spanish resort areas are just overcrowded
with Europeans. We are also seeing about 10% of the
numbers from Russian buyers looking for the Phuket
good life. Americans, Austrialians and other
Asians make up about 5% of the market.
TT.
“Is demand outstripping supply at the moment Larry?”
LC.
“ In some price ranges yes. For example there is an
acute shortage of properties in the range of between
5 and 10 million Thai Baht. Most purchases are either
less than 5 million Baht or more than 10. As an example
one development in Kamala, about 2kms from the beach
recently very quickly sold 42 units within that price
range.”
TT
“Would buying property on Phuket be best considered
an investment or simply a great place for a second
home?”
LC
“Both actually. Our experience has been that the new
owner only stays on Phuket for about one month per
year. The rest of the time it is rented out with ourselves
as the managers. We are normally successful in renting
out the property for 6 months. That brings in about
a 5% return on investment. As the market is still
young and fresh, it is too early to speculate on the
resale value of any property, we’re optimistic but
in fairness let’s take a wait and see attitude.”
TT
“Larry what about ongoing costs? Is domestic help
available and affordable for example?”
LC.
“Yes, most buyers will find the costs more than affordable
In fact many people find that for the normal price
of just one such worker in many countries, owners
on Phuket can afford to hire three and pay them a
good wage according to market standards”.
TT
“Larry thanks. I hope our readers have a little better
idea of property purchases on Phuket. I know that
your web site has a lot more detail perhaps you would
give us the URL.”
LC.
Absolutely. It is www.phuketonerealestate.com. And
if anyone wants to contact me directly my email is
info@phuketonerealestate.com.
Larry
Cunningham is the CEO of Phuket One Real Estate. Currently
Phuket One is the largest real estate agency on Phuket
with more than 700 properties for sale.
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