RESORT destinations Phuket, Hua Hin and Pattaya are popular with both local and foreign investors, according to research by property agency Knight Frank Thailand.
The condominium market in Phuket has transformed itself to accommodate a change in buyers' preferences, as well as to reflect the scarcity of land. Before 2008, the condo supply in Phuket tended to include larger units of more than 100 square metres,while 84 per cent were larger than 70sqm and only 16 per cent smaller than 70sqm.
From 2008 to 2014, 82 per cent of the total supply of condo units were smaller than 70sqm. Units smaller than 40sqm could only be sold when priced below Bt5 million. This represented a shift in buyers' intentions from self-occupancy to pure investment purposes.
"For investing in Phuket condominiums, a good area would be the west coast of [the island], from Mai Khao to Rawai Beach. Compact onebedroom units have investment potential; however, two-bedroom sea-view units from 71 to 99 square metres would be even better because of the scarcity of such units," said Risinee Sarikaputra, director of Knight Frank Thailand's research and consultancy department.
Phuket continues to attract its fair share of extremely wealthy foreigners and property investors, but the number of foreigners willing to spend Bt100 million or more for a luxury villa has been dwindling. This year, Phuket has been attracting more mass-market travellers, notably Chinese nationals and other Asians, whose numbers have helped offset the drop in jet-setters.Villas are still selling, but the numbers are more modest, as they are still priced beyond the means of most buyers, she said.
The interesting locations for investing in Phuket villas are along the west coast; however, the areas with more complete facilities and amenities for daily living include Bang Tao and Patong.
The Bang Tao area was first developed with the Laguna project. Later,several high-end projects came on the market there, followed recently by more middle-market developments and economy villa projects.
Meanwhile, the Hua Hin condominium market was previously popular among affluent Thai families from Bangkok, but recently, it has expanded to capture new demand from medium-income Thais. This was due to improvements in accessibility from Bangkok, better infrastructure, and completion of large retail venues and entertainment parks. From 2013 to 2014, 71 per cent of the supply included smaller studio and one-bedroom units, whereas the larger two- and three-bedroom units made up only 29 per cent, representing a change from the market before 2013.
For investing in Hua Hin condominiums, a good area would be between Soi Hua Hin 1 and Soi Hua Hin 85. The area is also considered convenient with facilities and amenities. The Khao Takiab area is also promising; however, most projects along that area are low-rises because of building-code regulations. A good unit for investment is a one- or twobedroom condo priced from Bt3 million to Bt5 million.
In the Pattaya area, each location offers a different character. At Jomtien Beach, there are a lot of service amenities, such as restaurants, pubs and entertainment venues. It is a tourist destination, especially the early sois in Jomtien.
The main buyers of condominiums in this area are Europeans and Russians, purchasing units for either second vacation homes or as an investment asset.
Condominiums with affordable prices (Bt40,000 to Bt60,000 per square metre) are situated away from the Jomtien coastline but remain in close proximity to the town area that offers substantial amenities. Buyers are mostly Thais and Russians.
There are also some projects in Jomtien that attract mainly Thai buyers, either for vacation homes or as investments or both; these are near the end of Jomtien, which is more peaceful and not considered to be a tourist area.
The Pattaya city area is more or less similar to Jomtien, with full-service facilities such as the CentralFestival Pattaya Beach shopping complex,restaurants and pubs. The area is quite busy, but it is convenient for tourists.
THE HUA HIN CONDO MARKET WAS PREVIOUSLY POPULAR AMONG AFFLUENT THAI FAMILIES,BUT RECENTLY,IT HAS EXPANDED TO CAPTURE NEW DEMAND FROM MEDIUM-INCOME THAIS.