Buying a property in Phuket gives the buyer not only practical benefits – living in a country with a warm climate and excellent conditions for rest but also financial.
Investment-attractive options to choose from in Phuket
The Thailand-Real.Estate source told its readers about the features of buying and investment appeal of Thai housing in Phuket.
It is worth knowing about this before buying real estate in Phuket?
There is not much free land in Phuket, so the number of ready-made real estate on the market is restricted, and their prices are constantly increasing due to limited demand. This is especially true for areas with a high population density and few buildings. Over the past few years, the number of small properties, such as condominiums, has increased.
Developers offer smaller apartments at a better price. During the pandemic, buyers began to pay more attention to detached houses and villas. Before deciding to buy an investment property, you should study the market and learn more about demand trends.
Depending on your goals and plans for buying or selling housing, Phuket is a great place to spend a lot of time. This island will offer you many amazing things to do and see here. It is full of history and stunning views. The nightlife of the island is one of its features. There are clubs and bars everywhere you can have a good time, and there are night markets with low prices.
Investment real estate potential
Beaches and amazing natural beauty are an integral part of the island, but real estate is no less important. Investors will find plenty of attractive housing options here for rent and resale. Due to the high tourist flow, this place is one of the most significant centers of Thailand for international tourism, and, consequently, the demand for housing here remains stable. However, it is important to understand that foreigners may have problems obtaining a loan to buy real estate, as the economy is still declining after the coronavirus. In addition, housing prices can also change.
Not to fail to choose, it is better to use the services of a professional in this field. A real estate agent will help you find a property for the price and the parameters you need. However, some agents in Phuket offer higher prices for their services – on average about 5% of the transaction value and VAT. But before asking a specialist for help, it is important to define the purpose of the purchase, only, in this case, the acquisition of a property will be most effective.
Housing prices in Phuket range from very high to low. However, the price corresponds to the quality of housing.
New buildings or a secondary property?
It is better to focus on new buildings. First, because at the start of sales you can get a low price, which will affect the profitability. Second, because there is no most profitable real estate on the secondary market. The most profitable are apartments in complexes with professional hotel management, located in the best resort areas in Phuket.
Hotel chains started coming here not so long ago. Most of the investors who invested in this asset chose programs with guaranteed income for the first five years, as it is unprofitable to sell the property earlier. But even if someone decides to sell, the buyer will lose.
Let’s say the first investor took an apartment at the excavation stage for ฿3.5 million, with a guaranteed income of 7% for five years. Two years later, he sells ready-made apartments on the secondary market for ฿4 million. The buyer will be obliged to accept the terms of the lease agreement, but he will receive 7% not of the 4 million, but of the 3.5 million that the first investor paid.
It makes sense to sell in five to seven years, when the first line will be built up and prices for your property will rise, or, if you want to resell earlier, do not join the guaranteed income program.
Apartments or villas?
You can earn more money in apartments. First, villas have higher costs – the cost of purchase, maintenance, repair, and so on. All this reduces profitability.
Second, the demand for renting villas is not as large as for apartments. As a rule, they are located a few kilometers from the sea, where land is cheaper. To relax in a private house, you need a car, but not all tourists are ready to travel around an unknown country with left-hand traffic.
Third, most villas do not have professional hotel management. Homeowners and small companies prefer to rent them out, which affects the quality of services and, accordingly, income.
And finally, most of the villas do not have a hotel license. This means that they cannot be legally rented daily, and long-term rents are much lower.
There are also exceptions to these rules. In Phuket, you can find a villa near the sea, in a complex with a hotel license, professional management, and guaranteed income. But you have to be willing to pay $2-3 million and more.
Assistance in purchasing real estate in Phuket
The catalog on Thailand-Real.Estate offers the best real estate in Thailand at prices from developers. You can get detailed information about investments in Thai properties from managers on the website.