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Phuket Condo (Condominium) Information
Phuket Condo & Associated Information
Phuket has established itself as a global resort destination, offering a range of luxury villas, condominiums and apartments for sale. Phuket properties are comparable to those offered in the Mediterranean and Caribbean, at a fraction of the price. Widely accepted as the pinnacle of the Asian resort market, the Phuket condo market has expanded since the 1990’s in line with the growth in its tourism. The Phuket condo market is well positioned with the island’s supporting infrastructure including world-class amenities and leisure facilities and an International Airport offering good accessibility. Many investors choose to invest in the Phuket condo market as it offers a combination of western luxury and an exotic tropical lifestyle.
In recognising the long-term potential of the Phuket property market, CB Richard Ellis opened our Phuket office in 2004. Our sales team of Thai and expatriate staff are experts in the Phuket condominium market. The CBRE team has some of the broadest market knowledge in the industry and is able to offer valuable insights for buyers and investors interested in purchasing in Phuket.
Thailand has specific definitions that describe the difference between an apartment or condo, and whilst different parts of the world use either apartment or condominium to describe what is essentially the same type of property, Thailand does not.
In summary, foreigners can buy and hold Thai real estate through a variety of ownership structures and land titles. The three most common forms of ownership used by foreigners to hold Thai real estate are leasehold, freehold through a condo title, and freehold through acquisition by a Thai company.
Below are the definitions of condominiums and apartments in Thailand:
Condominium: A multi unit building where there is freehold ownership of individual units and a common interest along with all the other owners in the land and common areas. In some countries this is called strata title. A condo unit is registered at the Land Department and each individual unit has its own title deed. Foreigners are allowed to own up to 49% of the total floor area of the condominium building on a freehold basis. (More Phuket condo listings)
Apartment: An apartment is a residential building held in single ownership on an individual title. Individual units are leased on a series of 30 years term which is registered with the land office. (Phuket apartment listings)
Phuket Condos: Types & Classifications
Phuket Condominium and apartments can be classified into the following grades:
Luxury Condominium/Apartment:
Prices of luxury condo units in Phuket are usually above THB 100,000 per sqm. Most luxury Phuket condos are located on prime sites offering good ocean views with close proximity to the beach. They are located in low-density developments offering a high level of privacy. Luxury condos are managed by professional management companies, or in some cases hotel-managed. Common area facilities include pool and gym. Penthouses in many luxury condo developments also feature a private pool, for example, The Heights and Andara Residences.
High-end Condominium/Apartment:
High-end Phuket condos are typically priced between THB 80,000 to 100,000 per sqm. Not all high-end condos in Phuket offer good ocean views, but many do and most are located in close proximity to the beach. High-end condos are managed by professional management companies and include common area facilities such as pool and gym.
Mid-range Condominium/Apartment:
Mid-range Phuket condo units are typically priced under THB 80,000 per sqm. Most mid-range condos do not offer ocean views, but are located in close proximity to the beach. The price of a one-bedroom unit in a mid-range development starts from approximately THB 5 million.
Phuket Condo Locations:
There has been a diversification in locations being developed in Phuket and condo/apartment developments are spread across the island. The west coast was the original centre of development where many condos today are located. As prime ocean view west coast sites have been taken up, the once overlooked east coast now sees an increase in the number of exclusive developments.
The West Coast
The stunning beaches of the west coast from Nai Thon down to Kata Noi are the centre of Phuket's tourism, with the initial developments concentrating around the Patong area. Today, an extensive number of condo/apartment developments are located on the West coast, spanning from mid-range to luxury developments. Kamala is also a popular area for condo developments with projects such as Andara Residences, Plantation and Kamala Falls located there.
The North Coast
With the shortage of west coast beachfront land, a number of property developers have moved up to the beaches on the north of the island (Mai Khao and Nai Yang), these offer close proximity to Phuket International Airport.
The East Coast
With a limited number of prime sites available on the west of Phuket, the east coast, with its stunning views across Phang Nga bay, is now seeing rapid development. Many of Phuket’s luxury condo developments are located on the east coast including Tawan Views and Baan Yamu condominium. Unlike the development pattern on the west coast where a range of property grades are offered, the east coast developments concentrate on the high-end and luxury segments.
South Coast
The distance from the Phuket International Airport and golf courses has resulted in a slower pace of development. The area is not as extensively developed compared to the east and west coasts and most developments found in the south coast are mid-range condo developments.
Inland
Most condo developments located inland are entry-level projects targeting the local market. Inland developments are situated near hubs of activity such as Phuket Town and Cherngtalay.
Purchase Options:
Re-sale Condos:
Re-sale condos are second-hand properties offered for sale by individuals, as opposed to sales directly from the original developer. These properties can be under construction (off-plan) or completed. To date, Phuket has had a limited market for re-sale condos as most buyers tend to be long-term investors and occupiers of their condos upon completion. However, the market for re-sale condos is a growing and maturing market.
Completed Condos:
Condos that have completed construction and are available for viewing. This type of condo purchase carries no development risk as the property is already constructed and buyers can also see the exact quality of finishing and design, which is not possible for off-plan purchases.
Off-plan Condos:
Off-plan condos are condos sold whilst the projects are under planning or construction. To minimise development risk in purchasing an off-plan condo, it is important to buy from a reputable developer. Most quality developments selling off-plan have show units available for viewing. There is often an appreciation potential for off-plan properties upon completion as off-plan sales are usually offered at a discount.
Investment Condos:
There are a number of developments positioned as investment properties with rental guarantee offers. Investment properties have owners’ usage restrictions as the units are part of a compulsory rental programme. The level of guaranteed returns varies from 5% to 8% for a period of 1 to 6 years and an annual owners’ usage of 45 to 60 days, depending on each project.
Investing in Phuket:
Having discovered Phuket as tourists, many then choose to invest in its property market, and buy a second or retirement home, or a property to rent out. With its outstanding white sandy beaches, unparalleled hospitality, tropical climate, great value for money, beautiful diving sites and some of Asia’s best golf courses, the Phuket property market is well positioned, making it a popular holiday home destination.
The island now has in excess of 3,500 condo owners. For the past ten years, Phuket offers property buyers a lifestyle investment with good potential for capital appreciation. Investors have experienced an average capital appreciation of 20% to 50% per annum for prime beachfront or sea view locations, although some properties have seen the value of their asset rise by as much as 100% between the launch and completion.
Lifestyle/ Leisure/ Infrastructure
Phuket currently has over 150 hotels & resorts along with an extensive sporting and leisure facilities. The island has a total of six golf courses including Blue Canyon Country Club, Laguna Phuket Golf Course and Mission Hills, and four marinas providing a total of 655 marina berths. As the Phuket’s tourism and property market has matured, there is also an expanding choice of upmarket dining and entertainment venues.
The island’s infrastructure is also well developed with an International Airport, 6 major hospitals and 3 international schools. The development of Phuket’s infrastructure and extensive leisure facilities has complemented the growth of the island’s real estate market over the years.
Weather Phuket has a balmy tropical climate and a fairly consistent temperature all year round (25 to 35 degree Celsius), with its best weather during the European winter. There are two distinct seasons in Phuket- the dry and green season. Phuket’s weather is at its best when the dry season starts in November through to January, while March and April are the hottest months. The green season runs from end-April to November when the rainfall is at its peak. (Phuket overview page)
Access to/from Phuket
Phuket arrivals exceeded 5 million in 2007. Served by a total of 42 airlines (14 of these are chartered airlines), the Phuket International Airport offers flights to destinations including Hong Kong, Singapore, Kuala Lumpur, Moscow, Seoul and numerous others. (Phuket travel page).
Phuket Condo Market Research:
This section outlines some of the findings from the CB Richard Ellis Phuket Property Report, a quarterly subscription report which brings professional analysis and transparency to the growing Phuket villa market.(Phuket Property Report Page)
Quarterly Highlights:
The average asking price (for primary sales) was THB 14.2 million per unit.
The number of completed resort condominiums as at Q3 2011reached 3,600 units, up 36% Y-o-Y and 9% Q-o-Q.
71% of total resort condominium units (completed, under construction, and planned) have been sold.
Phuket Condo Supply:
The number of completed resort condominiums as at Q2 2011 reached 3,600 units, up 36% Y-o-Y and 9% Q-o-Q.
We estimate that 71% of total resort condominiumunits (existingandfuturesupply) have been sold.
Phuket Condo Market Summary:
There is continued demand for residential resort property in Phuket but the market has changed in terms of what people want and what they are willing to pay. The villa market, although is better than in the first half of 2010, it is not as active as it was in 2009 or before because demand has partly shifted to the more affordable condominium market.
Phuket Property Payment Terms
The majority of properties in Phuket are sold off-plan or in a partly built state. Buyers will always be asked to pay a reservation fee. This secures the property which will then be taken off the open market. Then, some time (usually 30 days) is given to allow for legal work to be completed before the first payment is due on signing of the contract. Thereafter payments are usually split according to construction milestones.
Here is an example:
• Signing of agreement: 20%
• Completion of villa footings or pilings: 20%
• Completion of columns, floor slabs and roof frames: 20%
• Completion of villa shell, including external doors and windows: 20%
• Substantial completion of the villa: 20%
Sinking Fund
In a new villa or condominium project, each owner will pay an initial amount into a sinking fund on transfer of ownership of the property. This will be used for major renovations in future and repairs which are outside the operating budget.
Common Area Management Costs
In a villa or condo development, specifically appointed property managers, such as CB Richard Ellis, will normally be responsible for managing all aspects of the common areas.
This service normally includes:
• 24-hour onsite security
• Maintenance and irrigation of all common area landscaping
• Cleaning and maintenance of all the communal areas
• Management office and staffing as well as ancillary costs, accounting and Insurance.
• Electricity and water supply in the common areas, Refuse collection and Pest control
The property management company reports directly to the owner's committee on management issues and the financial status of the project. (Property management)
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The West Coast
Phuket has a balmy tropical climate and a fairly consistent temperature all year round (25 to 35 degree Celsius), with its best weather during the European winter. There are two distinct seasons in Phuket- the dry and green season. Phuket’s weather is at its best when the dry season starts in November through to January, while March and April are the hottest months. The green season runs from end-April to November when the rainfall is at its peak. .jpg)
