The island of Phuket, with its glorious weather and stunning scenery, has been attracting new investors and new residents in extremely large numbers over the last two decades. This trend is even more pronounced recently, with a record amount of foreigners, either choosing to make Phuket their new home in paradise, or singling out the island as an amazing place to invest their hard earned cash.

To suggest that Phuket is one of the most captivating tourist destinations in the world is, by no means, an understatement. Tourists come in their droves and many of these visitors end up as property owners on the island.

Due to new infrastructure projects, newly constructed road networks, and an ever increasing number of new tourist attractions, the island of Phuket has transformed over 30 years from an unheard of island in the Andaman Sea to one of the world’s premier vacation destinations.

The dynamic change we have seen has been mainly attributed to Phuket appearing on the radar of the global tourism industry after the 2004 Tsunami, which put Phuket on the map and catapulted it to worldwide fame as a place to go to for holiday makers seeking sun, sand and incredible food. Its amazing weather and wonderful culture leave no visitor disappointed, and the amazing beaches of the island certainly rival those of any other tourist destination around the globe.

Who Is Buying Phuket Real Estate?

The Phuket property market is driven, principally, by foreigners, whether for those looking for a solid investment, a holiday home or for residential purposes. Although the various nationalities purchasing Phuket property has tended to ebb and flow over the years, recent numbers suggest Russian nationals are playing a significant role in registering new properties, overtaking the previous top place holders, the Chinese.

Affluent Thai nationals are also buying in Phuket, which adds to the demand for luxury real estate. These are mainly high net worth individuals or families from the nation’s capital, although there are also many Thai nationals moving to the province from other parts of the Kingdom, seeking a better way of life and, perhaps, to also take advantage of the island’s future growth potential.

The Rapid Change in Phuket Property Dynamics – Phuket’s Increasing Popularity as a Place of Residence  

There is no doubt that the current number of Russians staying on the island, many of them consciously avoiding the troubles in their home country, is a contributing factor to the buoyancy of the Phuket property market. But the Russians are not the only ones moving to Phuket in large numbers. A whole host of nationalities have been arriving on the island, most of them rethinking life values after the ordeals of the last 5 years.

Subjected to extremely harsh draconian Covid restrictions in their home countries, many people of financial means have honed in on Phuket as a fabulous place to live, and a place they’d rather be if the same dire situation should ever be repeated. Many people around the world suffered a far from enjoyable experience during the lockdown period, and have actively been seeking a new home and a new life in less repressive regimes.

Pre-Covid, many foreigners visiting the island were mostly attracted by investment properties on offer, which capitalise on the burgeoning tourist market. But this long term trend has changed significantly, hence the new drive by developers towards the residential villa market, rather than the previously popular condominium investment market.

Because of this huge uptick in demand for residential properties, the Phuket real estate sector had a record year in 2023. In fact, demand for new homes on the island in 2023 far exceeded any previous year in Phuket’s real estate history. Not just viewed as a cash cow anymore, Phuket is now booming due to the stream of newcomers arriving on the island to set up home.

The number of retirees, young families and professionals making Phuket their new home is rather remarkable. For families, the popularity of the island is easily discernable from the amount of new international schools and second campuses setting up, all of which seem to be attracting new students. The latest example of this is the new Bangkok based, Ruamrudee International School (RIS) in the Palai area of Chalong in the south, hopefully opening in May 2024, and who obviously aim to replicate their successes in the capital.

There are also many expatriates who work regionally in Singapore, Hong Kong, Malaysia, or elsewhere, and who now have the option of living in paradise and making only the occasional trip to board meetings.

The Huge Property Choices That Now Exist   

With the island’s sudden new found acclaim, Phuket has seen spectacular growth in the real estate sector, with new projects springing up everywhere. This has created a huge choice of properties to choose from, ranging from extremely well priced condominiums, to luxury villas up in the tens of millions of US Dollars. This has, in many ways, revitalized the Phuket property sector. So vast is the current available choice of real estate in Phuket, it is almost impossible to remember every new project.

In fact, the property market in Phuket has evolved so much, that the island is barely recognizable today from how it stood 20 years ago. The choices are now immense, which is a huge positive for buyers of real estate, who in the past have been restricted to a limited amount of design styles, but now have a much broader selection to choose from.

Not Just Phuket’s Prime Locations Are Booming

As the front line west coast land is being used up, prices are moving steadily higher. As an island, albeit with a connection via the Sarasin Bridge to the mainland, land in Phuket is obviously in limited supply. With the market maturing, we are now seeing projects appearing on large tracts of land further inland, some of which still appear to be extremely popular with buyers.

New projects are springing up on land that has been sitting idle for decades, or used for agricultural purposes, such as for rubber plantations, coconut groves or pineapple fields. Even buffalo pastures are now disappearing as developers cater for buyers looking for better value away from the west coast high demand areas.

The lower land values further away from the west coast beaches, are obviously reflected in lower priced villas, a major contributing factor enticing buyers to look further inland. And because the average width of Phuket from east to west is only 20 kilometers, buyers of these inland properties are still only a 10 to 15 minute drive to the clear azure waters of the Andaman Sea.

As long as supply/demand dynamics remain relatively balanced, and the influx of new residents remains constant, there is certainly potential for continuing growth in the Phuket real estate sector. This is not necessarily caste in stone, but should current trends persist for the foreseeable future, we should all expect to see even more development on the island in the years ahead.