Phuket land prices skyrocket

PHUKET: The tax man will have some jolly years ahead as the government-assessed land prices for many locations in Phuket are seeing triple-digit rates of growth.

On Thursday, the Phuket Provincial Treasury Office (PPTO) confirmed details of the new land values, which were leaked to a Prachachart Turakij reporter in October (click here for full story).

Land appraisals are done every four years to set benchmark prices for land, which are used for reference by the PPTO when levying taxes on property transactions. The latest figures will take effect January 1, 2008, through to the end of 2011.

Assessed land prices in Thalang’s Srisoonthorn subdistrict increased by 284.68% while Cherng Talay and Paklok saw prices rise by 202.18% and 200.16% respectively.

The highest land price increase as a percentage for plots along a main road was 535%, for land on the Baan Don-Layan road in Cherng Talay. Prices for plots along that road rose from 2,000 baht per square wah (four square meters) to 12,700 baht, due to the large number of high-end developments in the area.

Land plots along Baan Layan-Baan Sakoo road in Sakoo also saw a dramatic price rise – an increase of 400% – from 2,000 baht to 10,000 baht per square wah, while land plots along Ton Sai Rd in Thepkrasattri rose 324%, from 2,500 baht to 10,600 baht per square wah.

Patong’s Thaweewong Rd, commonly called “the beach road”, reigns supreme as the priciest land in Phuket, with a new assessed price of 94,000 baht per square wah, up 113% from 40,000 baht in the last valuation.

For seaside property, Rawai had the highest rate rise, a whopping 592.31%, from 650 baht to 4,500 baht per square wah. Pa Khlok land values rose by 500%, from 500 baht to 3,000 baht per square wah.

Among housing estate properties, Baan Suan Yoo Charoen in Cherng Talay increased the most, by 643.33%, from 3,000 baht to 22,300 baht per square wah, followed by Moo Baan Roong Rawee and Baan Nai Yang Resort in Sakoo, which rose 500% and 566.67%, from 3,000 baht to 18,000 baht and 20,000 baht per square wah, respectively.

Baan Suan Neramit 2 in Kathu had the highest assessed land value among housing estates, at 33,200 baht per square wah, up from its previous assessed price of 10,000 baht.

Moo Baan Sun Palm Village in Chalong had the second-highest price, at 32,200 baht per square wah, rising from 8,000 baht, while Moo Baan Rom Mai Chai Lay in Rassada was assessed at 30,000 baht, up from 10,000 baht per square wah.

Dr Somsak Muneepeerakul, president of the Real Estate Brokers Association, said that the property market will continue to grow in Phuket, despite the tsunami and other challenges.

“The property business in Thailand in the next year will grow about 15% to 20% because we will have a new government and it will give investors confidence,” said Dr Somsak. “In the opinion of property people like me, we don’t want prices to rise too fast – we want it to grow more moderately in order to avoid a painful crash.”

Gazette property columnist Bill Barnett, of C9 Hotelworks, said, “Certainly, Phuket land prices have continued to move up despite the Foreign Business Act, political landscape and other issues.

“The government assessments are now coming in line with the actual market prices… Ultimately, taxation will benefit, which should provide the government with money to improve the island’s sagging infrastructure and modernize key elements such as highways, and overall hopefully invest something back into Phuket’s future.

“It’s not realistic to continue to take from the growing land boom without putting something back into the local municipalities,” he said.

Phuket Real Estate Club president Phummisak Hongsyok said that property buyers should not worry about the new Land Office figures. “I don’t think the new estimated prices will make [actual] land prices increase too much, especially in Patong and Phuket City, where the estimated price is not very different from market prices,” he said.

“People buying property in Phuket don’t have to worry because [prices] will not be much different from what they have been over the past three years,” he said.

Phuket News
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