Asian foreigners drive Phuket residential property market

While demand for luxury residences in Phuket took a hit last year and early this year because of the European debt crisis, demand among locals and foreigners from Asian markets including Singapore, Hong Kong, India and Malaysia continues to grow, challenging Bangkok property firms to expand their investments in the province.
Uthai Uthaisangsuk, Sansiri senior vice president for business development and condominium development, said the supply of residential units in Phuket was 7,320, up 8 per cent over last year. The condominium market has experienced the highest growth, followed by detached houses and then townhouses. The new supply is mostly in the downtown area and the east of the island, where demand is strongest.
There is also demand for property in the western and southern ends of Phuket, however. The strongest demand is for units priced at Bt2 million to Bt5 million.
The condo market can be segmented into three groups: those priced below Bt50,000, which represent about 45 per cent of the total; the Bt50,000-Bt100,000 segment, also around 45 per cent; and the above-Bt100,000 group, which has a share of about 5-7 per cent at present, Uthai said.
To cater to the growth in demand, especially among locals, Sansiri has launched its latest condominium project under “The Base” brand, The Base Downtown Phuket, at a starting price of Bt1.9 million per unit, worth a total of Bt800 million. Presales started yesterday and end on Sunday.
Sansiri plans to keep developing new projects in Phuket, with a total investment budget of more than Bt4.5 billion for the second half of this year.
The company’s confidence in the Phuket market’s potential is reflected in its expansion plans, Uthai said. Demand for housing continues to grow, he said, adding that Phuket is widely known as a premier tourist destination.
In addition, Phuket’s economy is strong, with promising trends such as further urbanisation and economic development. The number of Thai and foreign businesspeople in the province has also seen relatively high growth, significantly affecting demand for housing.
By increasing its investment in Phuket, Uthai said, Sansiri believes it is contributing to the overall economy of the province. When investment rises, hiring and consumer spending grow, leading to overall economic growth, he said.