Numerous foreigners are looking to buy property in Phuket for investment due to the island’s ideal location and tourism-driven economy. However, navigating Phuket’s real estate market can be complex for those unfamiliar with its nuances. Foreign investors can buy property in Phuket at the best deal, with this comprehensive guide equipping them with essential information and enabling them to make informed investment decisions. This article will navigate the unique aspects of buying property in Phuket.
Phuket property market in 2024
Phuket province is the country’s largest island in southern Thailand. It takes an average of 1 hour and 27 minutes to fly from Bangkok (the capital city) to Phuket. In 2023, roughly 424 thousand people lived in Phuket, with over 11 million tourists generating revenue of ฿ 388 billion ($11.56 billion). This surge came from a significant number of approximately 87.56 thousand Russian and 76.84 thousand Chinese tourists exploring the island. The real estate in Phuket has seen a rise in demand, with residential prices jumping by 10-15% in 2023, surpassing the usual 5% growth and marking the highest increase on record. This increase is driven by Phuket’s diverse property offerings, where foreigners can buy property in Phuket’s many prime investment locations.
Condominiums are in-demand freehold properties for sale in Phuket. In 2022, condominium sales to Russian buyers reached a total value of approximately ฿ 875 million ($26.07 million). During the same year, 240 condominium units were purchased by Russian buyers. Foreigners who buy property in Phuket for investment are prominent because of the high return on investment (ROI) that ranges from 5% to 7%. Moreover, the rental business is lucrative, with a substantial average yield of ฿ 16,166 ($482) annually for Airbnb. This income potential is why foreigners buy property in Phuket and venture into tourism-based businesses.
Can foreigners buy property in Phuket?
Foreigners can buy property in Phuket except for land since Thailand enforces strict regulations on foreign land ownership. The Land Code Act prevents foreigners from directly purchasing and owning land. Despite this restriction, there are several ways for foreigners to buy property in Phuket for investment:
- Condominiums: Foreigners can purchase condo units outright, subject to a 49% foreign ownership cap per building. However, this quota has recently been increased to 75%, enabling foreigners to buy more units. This change attracts more foreign investors, increases demand for condos, reduces oversupply, and revitalizes the condominium market.
- Thai company ownership: Another common approach is establishing a Thai company to buy property in Phuket. In this case, foreigners can own up to 49% of the company’s shares, with Thai citizens required to hold the remaining 51%.
- Leasehold agreements: While leasehold agreements do not grant ownership, they provide long-term use of land and property, typically for up to 30 years, with renewal options extending the term to 90 years. This strategy allows foreigners to rent various properties rather than buy property in Phuket.
- Marrying a Thai national: A foreigner married to a Thai national can buy property in Phuket and register it in the Thai spouse’s name.
How to buy property in Phuket: 6-step guide
Foreigners looking to buy property in Phuket must conduct careful planning and execution. This six-step guide outlines the essential steps to guide you through the process.
Step 1: Define your needs and budget
Start by determining what kind of property you want to buy, whether a house, condo, or land. Consider the size, location, and budget. Clear criteria will help you focus your search, saving time and effort when buying property in Phuket.
Step 2: Partner with a real estate agent
Given the complexities of real estate in Phuket, working with a local real estate agent is highly recommended. Their local expertise will be invaluable in finding properties that meet your needs. They can also provide market insights and assist in negotiations, helping you buy property in Phuket. A real estate agency in Phuket, like Own Property Abroad, can offer real estate services tailored to your transaction. We specialize in catering to foreign buyers seeking to buy property in Phuket.
Step 3: Conduct thorough due diligence
Conducting thorough due diligence is essential to buy property in Phuket. Verify the property’s legal status by checking the title deed. Carefully inspect the property to assess its condition and identify any potential risks. Furthermore, hiring professional appraisers to determine the property’s market value will give you a solid basis for your offer, ensuring it aligns with current market trends.
Step 4: Make an offer
After completing your research and due diligence, make an offer based on comparing current prices and trends in Phuket’s real estate market. Negotiate with the seller to reach an agreement on a fair price and favorable terms.
Step 5: Process the legal documents
Connect with a qualified property lawyer to review the sales contract and handle the legal aspects of buying property in Phuket. Fulfilling this step to buy property in Phuket is legally crucial. Typically, you’ll need to make an initial deposit of about 10% of the agreed price. Additionally, the Land Department requires a 2% transfer fee based on the property’s assessed value. The Land Department is the government agency responsible for registering property ownership and collecting related fees.
Step 6: Complete the purchase
Pay the remaining balance to buy property in Phuket and complete the transaction. Once you have paid, you will receive the title deed and other essential documents from the Land Department, officially confirming your property ownership in Phuket.
Options to buy land in Phuket, Thailand
Foreigners are restricted from buying land in Phuket due to Thailand’s strict regulations on foreign land ownership. The Land Code Act prevents foreigners from registering land under their names, effectively barring them from directly purchasing and owning land. However, buying land as a foreigner is possible. One option is establishing a Thai company and using the company’s name to buy land in Phuket. The company retains the land ownership but allows shareholders to become indirect land owners. Establishing a Thai company requires a minimum share of 51% must be Thai-owned, and the remaining 49% is open for foreign ownership.
Another option for foreigners who want to buy land in Phuket is to marry a Thai national. Since Thai nationality is a requirement for a person to register land, buying land in Phuket and registering it under the Thai spouse’s name is viable. Under Thai law, a foreigner married to a Thai national is recognized as a statutory heir. Furthermore, section 93 of the Land Code Act clearly states that a foreign national who is a lawful heir can inherit the land. However, the foreign statutory heir cannot register land ownership with the Land Department and is expected to sell the inherited land.
Finding real estate for sale in Phuket
Securing Phuket property for sale begins with a well-planned search. While navigating Phuket’s real estate market independently is possible, working with a real estate agent or property agency in Phuket can make the process more efficient. They have extensive market expertise and access to a broader selection of properties. Alternatively, online real estate platforms provide a convenient starting point if you prefer to conduct your search. Consider exploring our property listings to speed up your search and improve your chances of buying property in Phuket. Own Property Abroad offers a platform for a carefully curated selection of Phuket property for sale that you can choose from. We also provide other real estate services to foreign buyers. You can reach us at [email protected] if you need assistance from a property agency in Phuket.
Property prices in Phuket, Thailand
Foreigners looking to buy property in Phuket have many options at different price ranges. Below is a detailed table of the average cost of property investment in Phuket and other relevant information.
| Type | Average price | Average price/m2 | Annual growth | Average rent price | Rental yield |
|---|---|---|---|---|---|
| Condo | ฿ 6.07 million ($180,968) | ฿ 96,310 ($2,869) | – 0.1% | ฿ 45,816 ($1,365) | 9.1% |
| House | ฿ 19.13 million ($569,971) | ฿ 61,317 ($1,827) | 0.2% | ฿ 94,000 ($2,800) | 5.9% |
| Townhouse | ฿ 3.71 million ($110,664) | ฿ 31,896 ($950) | – 0.2% | ฿ 46,823 ($1,395) | – |
| Land | ฿ 33.78 million ($1.01 million) | ฿ 36,400 ($1,084) | – 0.5% | ฿ 20,000 ($596) | – |
| Commercial | ฿ 13.97 million ($416,257) | ฿ 38,676 ($1,152) | 0.1% | ฿ 45,772 ($1,364) | – |
| Apartment | ฿ 9.27 million ($276,301) | ฿ 95,296 ($2,839) | – 0.4% | ฿ 45,548 ($1,357) | 5.9% |
Best Phuket neighborhoods to buy property
There are excellent locations where you can buy property in Phuket. Here are some of the famous neighborhoods that offer the best Phuket property for sale:
- Phuket Town: Thalang Road is the main central street in Phuket’s old town. Phuket Town is an enticing option for those who appreciate a mix of history, culture, and urban living. Foreigners can buy apartments in Phuket around this area at affordable prices, including townhouses and condominiums. You can buy a house in Phuket’s old town, and if you prefer a more private and luxurious abode, villas are highly accessible.
- Rawai and Nai Harn: On the island’s southern tip, Rawai and Nai Harn provide a peaceful and more residential atmosphere. These areas are popular among expats and long-term residents who seek a more laid-back lifestyle. Due to the high supply, foreigners can buy property in Phuket around this area. You can buy a house in Phuket here with convenient access to living amenities. You will find local markets, stores, and cafes nearby. Furthermore, Rawai and Nai Harn are near some of Phuket’s most stunning beaches.
- Kata and Karon: These connected beaches are located on the west coast of Phuket. The distance between Kata Noi Beach and Karon is 4 km. Tourist attractions are accessible, including the Big Buddha, Karon viewpoint, and Dino Park Mini Golf. Kata and Karon have an expansive shoreline ideal for beachgoers. There is a good selection of hotels, restaurants, and bars, with many options within walking distance. Foreigners who want to buy land in Phuket can do so here, with beachfront, sea-view, and agricultural land options.
- Kamala: Located between Patong and Surin, Kamala provides a family-friendly environment. Known for its long beach, local markets, and laid-back atmosphere, Kamala attracts those looking for a quieter residential area while remaining close to popular tourist spots. Townhouses, commercial spaces, plots of land, and luxury properties are available for sale in Kamala. Moreover, foreigners can buy apartments in Phuket at highly affordable prices in this area.
- Surin and Bang Tao: The distance between Bang Tao Beach and Surin Beach is 5 km. Famed for their upscale resorts and luxury villas, Surin and Bang Tao are highly desirable for those seeking an exclusive and sophisticated lifestyle. It offers access to beaches, fine dining options, and world-class spas. Foreigners can buy a house in Phuket around these areas, with easy access to expensive amenities and luxurious accommodations.
Why invest in property in Phuket?
Buying property investment in Phuket is a good move for foreigners, especially considering the island’s substantial potential for high returns. The rental market is flourishing, driven by the numerous tourists visiting the island annually. Over 11 million tourists visited Phuket in 2023, generating ฿ 388 million ($11.56 million) in revenue. The Airbnb market in Phuket has an average occupancy rate of 67%, above the typical rate of 55-60% for Airbnb. The highest recorded occupancy rate is 72% for apartments and condos. Moreover, Airbnb in Phuket has a substantial average yield of $16,166 annually. Currently, there are 10,078 active Airbnb listings in Phuket.
Furthermore, the return on investment (ROI) ranges from 5% to 7% for property investment in Phuket. Property appreciation is between 5% and 10% per year, with the residential market in Phuket going strong in 2024, fueled by demand from Russian buyers and the anticipated return of Chinese buyers. Given the demand for accommodations and the high supply of Phuket property for sale, this island undeniably offers a profitable opportunity for foreigners interested in starting resorts, restaurants, rentals, or hotel businesses.
Expert support for buying property in Phuket
Buying property in Phuket as a foreigner involves navigating legal complexities and finding the perfect investment or vacation home. Our expert team is here to guide you through each step, from understanding local laws and compliance requirements to finding the right property and closing the deal smoothly. Whether you’re looking for a luxury villa or a lucrative investment, we offer personalized assistance tailored to your needs. You can also email us at [email protected] for detailed inquiries and specialized guidance.
Frequently Asked Questions (FAQs)
How much do houses cost in Phuket?
Houses in Phuket cost an average of ฿ 19.13 million ($569,883) or ฿ 61,317 ($1,827) per square meter.
How can foreigners buy a condo in Phuket?
Foreigners can buy a condo in Phuket directly. The process is the same as that of Thai nationals. However, a 75% foreign ownership quota per building is observed.
Where can I find new property developments in Phuket?
You can find new property developments in Thalang province, Phuket. Various options for new property developments are available, including luxury villas and high-rise condominiums.
How much can I sell my property in Phuket for?
You can sell property in Phuket at a high value due to the island’s property appreciation of 5% to 10% annually. A house for sale in Phuket costs an average of ฿ 19 million ($566,010). Moreover, prices for other properties cost an average of ฿ 607,000 ($18,083) for a condo, ฿ 9.27 million ($276,153) for an apartment, and ฿ 33.78 million ($1.01 million) for land.
How to find the best investment property in Phuket?
You can find the best investment property by connecting to a real estate agent or property agency in Phuket. Own Property Abroad has curated property listings and caters to foreigners who want to buy property in Phuket.
Is it better to buy a villa or a condo in Phuket?
Choosing between a villa and a condo to buy property in Phuket depends on your preferences and lifestyle. Villas offer more privacy and space. However, they generally require higher upfront costs and ongoing maintenance. Condos provide convenient access to amenities, including swimming pools, gyms, and security services. They are typically more affordable but may have limitations on space and privacy.
How can I buy freehold property in Phuket?
Foreigners can buy freehold property in Phuket through a condo or apartment subject to a 75% foreign ownership quota per building. Moreover, foreigners can buy freehold property for sale in Phuket by establishing a Thai company and purchasing properties under the company’s name or marrying a Thai national to buy property in Phuket under the Thai spouse’s name.
