Connect with us


By the book: Demand for Phuket rentals outpaces supply



PHUKET: The rental market in Phuket in recent years has been very strong, with rental prices increasing across the island, giving owners very attractive returns on their investment.

This surge in strength in the rental market has coincided with increasing tourist arrivals, which has led to demand for rental properties outpacing supply. Good rental properties have become more scarce as tenants have renewed leases or entered into long-term leases of sometimes as long as three years or more. This has made it much harder to source good rental properties on the island.

In Siam Real Estate’s Residential Market Research Report 2014, we found the average rental
returns for Phuket properties to be 5%, with rental returns ranging from 3% to 9 % in some cases.
Long term rental prices for Phuket ranged from an average of 22,000 baht a month for a two-bedroom condo to more than 200,000 baht per month for a villa property with four or more bedrooms.

Many property developers in Phuket are now offering off-plan buyers guaranteed rental returns. There are a variety of offers ranging from 4% net to 9% gross over periods ranging from two to 15 years.

Buyers would be wise to check the small print when agreeing to rental guarantees as many of those offering very high gross returns actually net down to a much lower figure. This can be checked through your real estate broker, who will be able to provide you with a breakdown of gross returns minus costs.
As highlighted in our recent article on Phuket’s resale market, currently certain owners are in a position where they can offer their properties for sale at a discount to the market value.

With the strong conditions in the rental market in recent years this has enabled buyers to purchase undervalued resale properties and achieve higher than average rental returns on their investment: with some owners able to achieve gross returns of 8% per annum or more. This is in stark contrast to other markets in the region such as Singapore and Hong Kong, where gross rental returns average less than 3% per annum.


Phuket’s rental market is very diverse and has experienced changing demographics during the past decade. Many different nationalities come to Phuket looking for holiday and long-term rentals, and therefore the rental market here is affected by changes in the global economy.

The global financial crisis in 2008-9 saw a fall in the number of Europeans and Americans coming to Thailand. These tourists were quickly replaced by a growth in arrivals from Russia, who seemed to have money to burn. However, due to the recent economic situation in Russia, there are definitely fewer Russians taking on long-term rentals of luxury properties compared with previous years.

Looking at the long term, Russians’ love of Phuket is unlikely to abate, and once the economy in Russia recovers this segment of the rental market is expected to recover with it.

There is also a trend of more and more expats in Southeast Asia relocating their families to Phuket due to the improving state of infrastructure, first-class international schooling and high-standard amenities. This segment of the rental market tends to use Phuket as a base and then commutes throughout the region for work, a factor made very convenient by Phuket International Airport.

The growing number of Asian tourist arrivals to Phuket will once again change the landscape of the island’s rental market, as this segment has different wants and needs than other traditional sectors that have been long established here.

Families want to be within easy reach of the island’s international schools and Asian tourists are less inclined to be located close to the west coast beaches. Instead, they prefer to be nearer to the island’s amenities, restaurants, shopping and other leisure activities and are more accustomed to staying inland. This will increase the demand for rental properties inland and push up prices in central, north and east Phuket.

The future of Phuket’s economy is very bright: the growth in airport arrivals has been extremely strong and looks set to continue with the airport expansion well underway.

This clearly shows the resilience of Phuket as a driving tourist destination in Southeast Asia. Phuket is investing heavily in its infrastructure and tourism sector, with investment driven by government and private sector spending, all of which bodes well for the future of the island.

For more information about this article contact Mr Hodges, the North Branch and Investments Manager for Siam Real Estate in Phuket and author of SRE’s Phuket Residential Market Research Report. He has more than six years’ experience in Phuket’s real estate market. Tel: 076-324042 Email:;

— Kevin Hodges


Get more from The Thaiger

Join the conversation and have your say on Thailand news published on The Thaiger.

Thaiger Talk is our new Thaiger Community where you can join the discussion on everything happening in Thailand right now.

Please note that articles are not posted to the forum instantly and can take up to 20 min before being visible. Click for more information and the Thaiger Talk Guidelines.

Archiving articles from the Phuket Gazette circa 1998 - 2017. View the Phuket Gazette online archive and Digital Gazette PDF Prints.

Follow Thaiger by email:

Thailand8 mins ago

Thailand among top 5 destinations for Chinese travelers | GMT

Travel12 hours ago

Where to find underrated international cuisines in Bangkok

Bangkok13 hours ago

Chinatown manhole covers to use art, tech to become cultural map

Sponsored50 mins ago

British International School Phuket: Reflecting on 25 years of world-class education

Transport14 hours ago

Man fights Indian Railways for 22 years for justice (and 9 baht)

Events16 hours ago

Tourism Minister visits Full Moon Party, supports later curfew

Crime16 hours ago

Thais cautioned against fake government websites

Join the conversation on the Thaiger Talk forums today!
Thailand17 hours ago

Another Thai boxer dies from brain injury after fight in Malaysia

Thailand18 hours ago

Expats in Thailand, Cartoon characters & Letting Loose | Thaiger Bites

Pattaya18 hours ago

VIDEO: Young Thais have a blast at Pattaya Music Festival weekend 2

Pollution19 hours ago

Anti-Corruption Network complains of smelly wastewater in coastal Thai province

Weather19 hours ago

Flooding from overflowing rivers soaks Chiang Rai and the border

Phuket20 hours ago

Phuket police nab 3,373 meth pills from 5 suspects

Pattaya22 hours ago

Pattaya night club owner gives free meals on Thai Mother’s Day

Thailand23 hours ago

Current Thailand Visa Options for Digital Nomads

Central Thailand23 hours ago

Police find fake Covid-19 tests worth millions in central Thailand

Thailand11 months ago

Morning Top Stories Thailand | Police to end protests, Human Trafficking | September 14

Thailand1 year ago

Thailand News Today | Thai Airways in rehab, All go for Songkran | March 4

Tourism1 year ago

Phuket’s nightlife. Yes, bars and clubs are still open | VIDEO

Phuket1 year ago

Thailand News Today | Covid passport talks, Thai Airways heads to court | March 2

Tourism1 year ago

Phuket Thai food treats you need to try | VIDEO

Thailand1 year ago

Thailand News Today | Bars, pubs and restaurants ‘sort of’ back to normal | Feb 23

Tourism1 year ago

In search of Cat & Dog Cafés in Phuket Town | VIDEO

Thailand2 years ago

Thailand News Today | Gambling crackdown, Seafood market to reopen, Vlogger challenge | Jan 21

Thailand2 years ago

Thailand News Today | Covid testing for visas, Business impact, Vaccine approval | January 19

Thailand2 years ago

Thailand News Today | Weekend Bangkok bombs, Thailand fires, Covid update | January 18

Thailand2 years ago

Thailand News Today | Stray car on runway, Indonesian quake, 300 baht tourist fee | January 15

Thailand2 years ago

Thailand News Today | Governor off respirator, sex-trafficking arrest, condo prices falling | January 14

Thailand2 years ago

Thailand News Today | Chinese vaccine, Thailand ‘drug hub’, Covid update | January 13

Thailand2 years ago

Thailand News Today | Bangkok may ease restrictions, Phuket bar curfew, Vaccine roll out | January 12

Thailand2 years ago

Thailand News Today | Covid latest, Cockfights closed down, Bryde’s Whale beached | January 11