Figures show huge property boom

PHUKET: Figures indicating how the property industry in Phuket is booming were presented yesterday by the Phuket Real Estate Club (PREC).

At a conference on the southern Thai economy, held at the Royal Phuket City Hotel, PREC Secretary Thanit Prateepnathalang said that between January and July this year, property companies applied for permission to build 43 new developments. Of these, 28 had so far been approved.

The investment in individual developments ranges from 250 million to 700 million baht, he said, noting that most are aimed at European or American buyers.

Last year, according to figures from the Phuket Provincial Land Office (PPLO), 10 property companies were granted permission for developments.

“The government’s decision [two years ago] to reduce taxes and fees on property investment to 0.01% has made the property business grow rapidly, especially in Phuket,” said K. Thanit. “About 40% of investment in Phuket is in real estate.”

Another indicator of the property boom supplied by K. Thanit was the amount of tax collected by the PPLO. In 2003 the figure was about 100 million baht, he said, whereas in the first three months of this year alone, a massive 456 million baht in taxes was paid to the PPLO.

He said, “Land on Phuket is one-fifth the price of land in Singapore, but we expect it to increase to half the Singapore price. It currently sells for [as much as] 20 million baht per rai.

“The trend for real estate investment is still upward, but I worry that it may be growing too rapidly, and may result in another bubble crisis [like in 1997],” he added.