Phuket is undergoing a profound transformation from a holiday paradise to a major center for permanent and long-term stays marking a significant evolution in its real estate landscape, with Thai nationals increasingly investing in beachfront properties previously coveted primarily by foreigners.

For years, my affluent Thai acquaintances expressed bewilderment over the allure that beachfront plots in remote, amenity-lacking locations held for foreigners. Now, however, affluent Thais are enthusiastically investing in land and villas in sought-after locales such as Bangtao Beach.

A notable example is the swift sale of four beachfront villas at the southern end Laguna Phuket. Two of the properties, priced at US$7-8 million, were purchased by Thai nationals.

Furthermore, major Thai property developers are escalating their involvement in Phuket, aiming to capitalize on its burgeoning real estate potential. Laguna’s plans to develop 10,000 residential units over the next decade exemplify this trend. Importantly, these developments are not confined to hotel rooms but comprise flats for longer stays, heralding the emergence of vibrant residential communities in Phuket.

However, the rapid urbanization also poses challenges. Without adequate investment in transportation and public amenities, Phuket risks succumbing to the pitfalls of its own success, with congested roads and strained resources undermining its appeal.

Despite the challenges, Phuket’s real estate market continues to attract international investors, with Russians accounting for a significant share of property transactions in 2023. This foreign investment, coupled with the growing appetite of domestic buyers, underscores Phuket’s emergence as the “Cote d’Azur of Asia.”

As an investor with diversified interests, I focus on hotel-branded properties in well-established areas and thriving markets. These investments offer a reduced risk while yielding substantial advantages and granting investors the opportunity to personally enjoy the luxuries of their investment by residing in their own property. Additionally, I explore properties located beyond the confines of Phuket, recognizing its evolution into a mature market.

The expansion of construction inland is expected to reshape the island’s property landscape, with beachfront areas becoming premium real estate hubs. Investors eyeing more affordable options may pivot towards the east, while the development of Natai Beach in the north, bolstered by the construction of an international airport, presents lucrative opportunities for larger-scale investments.

In conclusion, Phuket’s transition from a holiday destination to a residential hub signals a new chapter in its evolution. While challenges loom on the horizon, the island’s allure remains undeniable, with investors poised to capitalize on its growing prominence in the global arena.

ABOUT

Alexander Karolik Shlaen is the founder of the Singapore-based Panache Management Pte Ltd (PM), which represents Aston Martin and Formitalia design lines in Asia. PM is involved in property & technology investment and provides luxury interiors and design for exclusive real estate, private jets and super yachts. Shlaen has appeared in various regional & global media and TV and has written the Luxury Expert columns of regional magazines since 2009.

Shlaen was also the chairman of the judges panel for Asia Property Awards and is frequently sought to attend established business forums and events. 

As one of the few market analysts to predict a property boom in Singapore and the region at a time when global markets were in decline, Shlaen’s expertise is in high demand from family offices, private bankers and wealthy investors.

Shlaen holds an Executive MBA from the Kellogg School of Management and the Hong Kong University of Science and Technology.

Learn more on PanacheManage.com.