While the Real Estate Information Center (REIC) has reported sharp declines in sales and new project launches across Bangkok and Phuket in the first half of the year, Phuket’s market is showing greater resilience. Developers have scaled back launches and focused on clearing inventory as financial institutions tighten lending and domestic purchasing power contracts.
Foreign buyers, once dominated by Chinese nationals accounting for up to 40% of condo purchases, have now fallen to just 10-15%. In Phuket, this has translated to a drop of more than 50% in overseas purchases during the second quarter, typically the island’s low tourism season. Still, industry leaders say demand remains strong, particularly in the luxury villa sector.
“Although the market has slowed somewhat, Phuket is unlikely to face an oversupply situation,” said Phattanan Phisutthiwimol, Vice President of the Phuket Real Estate Association. “Investors are being more cautious, but the market will improve in the fourth quarter as peak tourism season returns.”
Villa projects in Bang Jo, Cherng Talay and Pasak continue to attract investors, with units priced at B30-40 million. Land prices have surged to over B20mn per rai in some areas, up from B6-7mn just a few years ago. Construction costs have also risen, pushing developers to adjust prices accordingly.
Mr Phattanan noted that around 4,000 villas launched in 2024 have already sold more than 50% of available units, while Phuket still has a surplus of up to 40,000 condo units. Even so, foreign interest is steady, supported by diverse markets in Europe, Russia, China and the United States, he said.
Developers say Phuket’s long-term prospects remain robust thanks to its global positioning as a lifestyle and wellness destination. “Phuket is no longer just a tourist spot. It is becoming a hub for the creative economy and quality of life,” said Thitiwat Kuwijit Suwan, CEO of Capstone Asset Co. He pointed to Bang Tao as a “world-class lifestyle sandbox” attracting digital nomads, foreign investors, and premium buyers seeking both vacation homes and long-term residences.
The government’s Long-Term Resident Visa (LTR) scheme, along with major infrastructure investments such as the expansion of Phuket International Airport and the planned Andaman International Airport in Phang Nga, is expected to boost demand further. Road expansion projects, including a new expressway to Patong, will also ease connectivity.
Leading developers are responding with ambitious plans. Sansiri PLC has announced 29 new projects worth B33 billion nationwide between 2025 and 2029, with Phuket a core focus. The projects will target wealthy Thais, long-term expatriates, and new groups of buyers from Israel, Russia, India and the LGBTQ+ community.
CBRE data shows luxury condos in the Bang Tao-Cherng Talay area generating rental yields of up to 10%, with occupancy rates in 2024-2025 averaging nearly 80%. Sales in Phuket’s west coast condo market grew by more than 200% year-on-year at the end of 2024.
“Phuket combines residential value with sustainable returns, supported by its international schools, hospitals and connectivity,” said Mr Thitiwat. “It has become one of the fastest-growing real estate markets in the country.”
For now, challenges remain from global economic uncertainty, inflation, and geopolitical tensions. But with international investors continuing to view Phuket as a safe haven and lifestyle destination, market watchers say the island is positioned to outperform the rest of Thailand in the coming years, noted the REIC report.