Buying a property in Phuket: a complete guide

All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.

Yes, the analysis of Phuket's property market is included in our pack

Are you considering investing in real estate in Phuket? You're not alone!

Many people are intrigued by Phuket's tropical allure and dream of owning a luxurious villa or a modern condo with sea views there.

Would it be a smart investment, though? Are property prices increasing on Phuket? How much does it cost? Is it better to invest in Patong or Kamala? Are there any hidden fees? Which place will give me the best yields?

In this article, everything is sorted out for you.

The BambooRoutes team has really dug into this market. Actually, we have condensed all our findings in a pack. Get it now.

In this article, we'll provide you with helpful information.

How's the real estate market on Phuket?

Is the property market thriving or struggling? We'll find the answers through data analysis.

Property types

In Phuket, you can find a variety of properties for sale.

These include beachfront villas with stunning ocean views, cozy condos nestled within vibrant neighborhoods, spacious townhouses offering a mix of comfort and convenience, and serene land plots for those looking to build their dream home.

Whether you're seeking luxurious retreats, modern urban living, or a blank canvas to create your own haven, Phuket offers a diverse range of real estate options to suit various preferences and lifestyles.

What's better: buy or rent?

(If you want to live there yourself and not rent it to others)

Whether you're considering settling in Phuket, Thailand's popular island destination, or already living there, you might be pondering whether to buy or rent a property.

Obviously, it's better to buy if you are looking for a long-term investment that can appreciate in value over time and provide a steady source of income.

Actually, the property price-to-rent ratio is a good metric to look at for this kind of decision. This metric tells us how many years of rental income it would take to pay for a property at its current price.

According to Numbeo, the property price-to-rent ratio on Phuket is around 24.7, which is around the world average.

This value shows that it would take you 25 long years of paying rents before you can own a property on Phuket. Renting for such an extended period means you wouldn't be building any equity, and you might end up spending more money without gaining ownership of the property.

Property prices on Phuket

On average, according to the updated data from Bank Of Thailand, purchasing a property on Phuket should cost you around $3,140 per square meter.

Obviously, there are big differences. A villa on the cliffs of Phuket might have a higher price per square meter than a condo in Patong. We actually give you a more detailed breakdown in our pack for buying property on Phuket and in Thailand.

To give you a sense of scale, it means that, instead of buying an apartment in Paris or London, you can afford 4 properties on Phuket.

Also, housing prices on Phuket are 30% cheaper than in Koh Samui.

The most expensive neighbourhoods on Phuket are probably Kamala, Surin and Bang Tao, while the cheapest are likely to be Rawai and Chalong.

Trends

First and foremost, we have to acknowledge that Thailand is, today, a relatively stable country. The last Fragile State Index that has been reported for this place is 70.

It is something to have in mind when wondering whether it's a good investment to buy a property on Phuket.

Besides that, if we look at the IMF's GDP forecasts, Thailand's economy is expected to soar by 15.1% in the coming 5 years, resulting in an average GDP growth rate of 3%.

If you intend to invest in real estate on Phuket it's a good thing because it means richer citizens, more demand for the housing market, less default on mortgages, better services, etc.

Also, in Thailand, the average GDP per capita has dropped by 0.9% over the last 5 years. It's an alarming number.

Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Thailand right now.

Buying property on Phuket

Buying real estate on Phuket can be difficult due to the lack of reliable and updated information available. That's why we have created the pack to buy property on Phuket and in Thailand.

Buying process

Within our pack, we have outlined the complete buying process. This includes the necessary documents, the applicable taxes, as well as information about where to locate properties, and more.

Here, we are providing you with a simpler version to assist you in better comprehending the information.

This is the step-by-step process to purchase a property in Phuket:

1. Research property market and regulations in Phuket.
2. Engage a reputable real estate agent specialized in Phuket properties.
3. Select suitable properties and conduct viewings in Phuket.
4. Verify property ownership and legal status with the Land Office in Phuket.
5. Negotiate the price and terms with the seller, considering the specifics of the Phuket market.
6. Sign a reservation agreement and pay a deposit through a Thai bank account.
7. Hire a lawyer in Phuket for due diligence and contract review.
8. Sign the sales and purchase agreement, complying with Thai property laws.
9. Transfer funds to a Thai bank account for the property transaction in Phuket.
10. Complete property registration at the Land Office in Phuket, submitting required documents.
11. Pay applicable taxes and fees according to Phuket regulations.
12. Obtain ownership documents, such as the Chanote land title, and take possession of the property in Phuket.

Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Thailand.

Make a profitable investment in Phuket

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Where to find a property

Explore these websites to find properties in Phuket:

• A Place in the Sun - A leading overseas property portal with over 100,000 properties from around the world, including Thailand.
• Savills - Your go-to source for expert buying, renting, and letting services, tailored to your specific property needs.
• DDproperty - A leading Thailand property website, offering a wide range of properties for sale and rent with detailed information, maps, and photos.
• Dot Property - Your ultimate destination for finding and purchasing various properties for sale in Thailand.
• FazWaz - One of the leading real estate marketplaces to buy, rent, and sell property in Thailand.

Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Thailand.

What you can get

As mentioned before, the average price per sqm on Phuket is $3,140. A 1-bedroom property with an area of 60 square meters would cost approximately $188,000, and a 2-bedroom with an area of 85 square meters would cost approximately $267,000.

However, as you can guess, property prices will differ based on the attributes of the property and its specific location.

Expect property prices to be on the higher side in the premium areas of Phuket. A villa near Kamala Beach could come to around $760,000, whereas an apartment in Surin might be priced at $330,000.

Certainly, certain areas are more affordable. You might come across a condo in Patong for $160,000, or a 1-bedroom priced at $90,000 around Thalang.

We give more details about property types and areas in our full pack for buying property in Thailand.

Common mistakes

Here are the main pitfalls when buying a property in Phuket, Thailand:

• "Chanote" land titles may have issues if not properly verified, leading to legal disputes.
• Foreigners facing ownership restrictions on land, often requiring complex lease structures.
• Off-plan purchases with untrustworthy developers and construction quality concerns.
• "Nor Sor Sam" titles lacking precise boundaries, causing boundary disputes.
• Unclear regulations on building heights, leading to obstructed views in the future.
• Foreign ownership restrictions on certain property types, like beachfront land.
• Failure to consider land utilities and access, hindering development plans.
• Not accounting for changing tourism trends impacting rental demand and returns.

We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.

Everything you need to know is included in our Thailand Property Pack

Living on Phuket

Living on Phuket is a great experience, offering a unique combination of beautiful beaches, vibrant culture, and a relaxed atmosphere.

Cost of living

The cost of living on Phuket is generally quite reasonable, with food and basic accommodation being relatively inexpensive. However, prices for luxury items and services can be quite high due to the high demand for these items.

Here are some examples to better understand the cost of living in Phuket, Thailand:

• Rent for a one-bedroom apartment in the popular neighborhood of Patong Beach: $800 per month.
• A meal at a local restaurant with "Pad Thai," a famous Thai dish: $4.
• Monthly motorbike rental for easy transportation: $50.
• Utilities (electricity, water, internet) for a small apartment in Kata Beach: $60 per month.
• A refreshing "Coconut Water" straight from the fruit: $1.
• Ticket to a local "Muay Thai" boxing match: $20.
• Monthly membership at a local fitness gym like "Tiger Muay Thai": $80.
• A bottle of local "Mekhong" whiskey, popular among locals: $10.

Neighbourhoods

We want to show information in an easy-to-understand way. So, we made a summary table that lists the different areas of Phuket. For yields, prices and rents, check our property pack.

Life on Phuket

Phuket is a popular tourist destination and its economy is heavily reliant on tourism. It is also home to a growing number of expats and retirees who are attracted to its low cost of living and attractive lifestyle.

What expats usually like the most on Phuket is the beautiful beaches, such as Kata Beach and Patong Beach, and the vibrant nightlife in Patong.

Access to healthcare on Phuket is generally good, with a range of both public and private hospitals and clinics.

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Renting out on Phuket

This part is for you if you want to buy a property with the goal of renting it out and making money from it, rather than living there.

Long-term

Tenant Profiles on Phuket

According to the data reported by Wikipedia, the home ownership rate in Thailand is 80%, which is rather high.

It is probably a bit less on Phuket which is quite different from the rest of the country.

If you decide to buy and rent out to long-term tenants, you should target working professionals, couples, and families looking for a beachside property. For short-term rentals, you should target tourists and holidaymakers looking for a vacation spot.

Here is a little summary table we've made for you.

Rental yields

Nowadays, rental yields on Phuket are usually below 5%. It's not much. A good rental yield generally falls within the range of 7% or more.

The best rental yields on Phuket are typically found in areas with high demand for short-term rentals, such as beachfront condos or villas in popular tourist destinations. These properties are in high demand due to the influx of tourists visiting the island, allowing owners to maximize their rental income.

For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.

Short-term

You could also decide to rent short-term to tourists visiting Phuket for vacations or business travelers looking to stay for a few days or weeks. Additionally, you could rent to people who are relocating to the area for work or study.

If you decide to go with that option, look for properties in Patong, Kata, Karon, and Surin. These are the most popular areas for short-term rentals due to the abundance of attractions and amenities.

You will have some competition though - there are around 15,000 Airbnb listings on Phuket. The average daily rate stands around $110.

You have the opportunity to generate a nice additional income stream then. Based on feedback from online testimonials and data analytics platforms such as AirDNA, Guesty, and Inside Airbnb, people who offer short-term rentals on Phuket can make around $1100 per month. Also, the average occupancy rate is estimated at 68%.

Is it worth buying real estate in Phuket then?

Buying a property in Phuket can be a fantastic idea for those who are looking for a long-term investment and a place to call home in a tropical paradise. Phuket offers a diverse range of properties, from beachfront villas to cozy condos, making it suitable for various lifestyles and preferences.

If you plan to settle in Phuket and want to build equity while enjoying the island's beauty, buying a property is a smart choice. The property price-to-rent ratio suggests that renting for a prolonged period might leave you spending money without gaining ownership, making buying a property a more financially sensible option.

Moreover, Phuket's property prices are relatively affordable, especially when compared to major cities, and Thailand's stable economy and projected GDP growth indicate a favorable environment for property investments.

However, it's crucial to do your homework and navigate potential pitfalls wisely. Ensure you work with reputable agents and lawyers, carefully verify land titles, and understand local regulations and ownership restrictions for foreigners.

Phuket's rental market, while offering income potential, typically yields less than 5%, so don't expect quick riches. Short-term investors may find the competition intense, with thousands of Airbnb listings.

But for those seeking a long-term investment and a slice of paradise, buying a property in Phuket can be a smart and rewarding decision, offering both financial stability and the chance to embrace the island's vibrant culture and natural beauty.

Make sure you understand the real estate market in Phuket

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The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.