Phuket real estate expands to inland areas
2023 to 2024: Unprecedented growth in Phuket’s property market
Phuket’s real estate market has experienced unprecedented growth over the past few years, driven primarily by the strong recovery of tourism following the Covid-19 pandemic.
Another hugely important factor contributing to this market buoyancy has been the increase in Russian investors, who led the way in terms of foreign investment for 2023 as they sought safe havens for their capital amid geopolitical tensions.
Thai government initiatives, including new and extended visa programmes such as the Long-Term Resident (LTR) Visa, have further bolstered foreign interest in the island. The rise of digital nomads and the global shift towards remote work have also made Phuket an appealing destination for families looking to live and work from home.
This worldwide trend, where any location with robust infrastructure can serve as a workplace, aligns perfectly with Phuket’s offerings. Not only does the island boast excellent infrastructure, but it also provides a tropical lifestyle with superb connectivity, rich cultural attractions, and a relatively low cost of living.
Furthermore, the property market in Phuket offers excellent value for money compared to similar properties in the home countries of most overseas investors, as well as other resort destinations such as Dubai, Marbella, and Ibiza.
In 2023, villa sales in Phuket reached unprecedented levels, with over 400 units sold—quadrupling the annual average, according to CBRE. The condominium market also set a record, with over 2,000 units sold.
The first half of 2024 continued this upward trend, with the Real Estate Information Center (REIC) reporting strong growth in both condos and villas, driven primarily by foreign demand (source: Bangkok Post). The villa market, in particular, saw significant increases across all indicators: new villa supply reached 1,175 units, a 383% rise from the second half of 2023, and the value of new supply surged to 38.3 billion baht, up 272%.
Total villa supply exceeded 1,000 units for the first time, reaching 2,261 units valued at 84.5 billion baht. New villa sales nearly doubled to 787 units worth 30 billion baht in the first half of 2024, compared to 403 units worth 17.9 billion in the latter half of 2023.
Two key trends shaping Phuket’s real estate market
In recent years, Phuket has seen a notable shift in its property market, with an increasing focus on the mid to high-end segments. This contrasts sharply with pre-pandemic trends that were more geared towards entry-level properties. The market has evolved to attract a new wave of buyers who are less price-sensitive and more interested in upscale investments.
This shift has turned the dynamics in favour of sellers, reducing the need for once-common price cuts. The luxury sector now thrives, driven by lifestyle-focused individuals and families seeking tailored investments, prioritising space, and eco-friendly, sustainable living options.
Developers have responded with an impressive range of luxury lifestyle properties, many integrated with renowned international brands.
As Phuket’s luxury sector has expanded, so has the demand for branded real estate. Consequently, international brands, alongside developers, have established the island as a prominent destination in Asia’s branded residential market, appealing to high-net-worth investors globally.
While Dubai remains a larger market, Phuket has emerged as a leader for branded properties in Thailand and the region, reflecting a shift from its traditional tourism-reliant economy to a robust property market focused on luxury and exclusivity. By September 2024, Thailand’s branded real estate sector was valued at US$5.7 billion (198.1 billion baht), with Phuket holding a dominant share of this market.
This growth is fuelled by the demand for branded residences that merge hospitality and residential living, offering unique lifestyle investments. These properties provide not only luxury homes but also access to premium amenities and high-quality management.
Developments such as Laguna Phuket exemplify this shift, evolving from a purely hospitality-focused model to a mixed-use strategy that capitalises on increasing land values and demand for branded projects.
Phuket’s branded developments can now be considered Class A properties, with some delivered by renowned international hotel groups, such as the Standard Residences in Phuket Bang Tao. Others involve hotel affiliations creating partnerships with wellness, automotive, and fashion brands, exemplified by Tri Vananda’s collaboration with Clinique La Prairie.
This movement signifies Phuket’s transition from a tourism-centric economy to a more integrated model that combines property, hospitality, and lifestyle. The post-pandemic global trends of urban flight, remote work, and increased demand for resort-style living have contributed to this evolution.
The Banyan Tree Group’s US$2 billion expansion into branded real estate adjacent to its Laguna Phuket resort exemplifies this strategy, leveraging brand prestige to attract investors seeking secure, high-end opportunities.
With strong foundations in place, Phuket’s branded real estate sector is poised for continued growth. The blend of luxury, brand recognition, and tropical lifestyle ensures that Phuket remains a top destination for discerning investors, offering a vibrant and exclusive property market.
Expansion of the Phuket property market into new areas
As Phuket’s property market has matured, development has expanded further inland, moving into areas that were previously undeveloped or used for agriculture. This expansion is driven by several key factors:
High market demand and coastal supply shortages
The strong demand in Phuket’s real estate market in recent years has led to land in prime coastal areas like Bang Tao, Surin, and Kamala becoming increasingly scarce and expensive. Consequently, the natural response has been to extend property development inland to meet this demand.
Eco-friendly and sustainable development
The rising demand for eco-friendly, sustainable projects lends itself particularly well to development inland. These types of projects often require more space for green areas and lower-density living to maintain sustainability and integrate natural environments.
Such features help manage stormwater, improve air quality, and support healthier living. Inland areas, where land is more affordable, allow developers to prioritise these sustainable features, making them better suited for projects emphasising renewable energy, community gardens, and lower population density.
Tri Vananda in Thep Krasatti exemplifies this trend, a wellness-focused community covering 237 acres, with only 15% of the land developed to preserve tropical landscapes, a scenic wetland reserve, and an organic community farm.
Shift in buyer demographics
The types of buyers have evolved, with more people seeking long-term residences rather than just holiday homes. Digital nomads and remote workers, who prioritise space, affordability, and modern infrastructure over direct coastal access, are driving this trend. Inland properties offer these features along with a more balanced work-life environment, appealing to those looking for year-round living without the premium of beachfront property.
Phuket’s compact size
With Phuket spanning only about 48 kilometres (km) from north to south and 21 km from east to west, no location on the island is more than approximately 10 km from the coast. This compact size means inland areas remain attractive to investors, who are reassured by the island’s accessibility. Buyers appreciate that even inland properties are never more than 30 minutes from the stunning beaches and sunsets of the Andaman coast.
Proximity to new amenities
The value of being close to new infrastructure and amenities is another driver for inland development. Areas near international schools, shopping centres, and tourist attractions. As long as these inland projects are of high quality and present good value, particularly in comparison to prices in buyers’ home countries, they continue to draw interest.
Improved transportation infrastructure
An important complementary factor supporting the expansion of property development inland is the ongoing improvement in Phuket’s road system. Earlier this year, the Thai government announced an infrastructure development plan for Phuket (source Bangkok Post), which includes both immediate and long-term projects aimed at enhancing the island’s connectivity and road system.
Immediate upgrades on Highway 402, such as smart traffic signals and no-parking zones, are designed to reduce congestion. By 2026, Highway 4027 is set to expand to four lanes, easing access to more inland areas. Additionally, the proposed expressway connecting Patong Beach to Phuket Airport, expected by 2030, will further improve the island’s accessibility.
These infrastructure enhancements make distance from the coast less of an issue for buyers, rendering inland properties more attractive and accessible.
Looking forward
As Phuket’s property market continues to evolve, the trend of expanding development inland is expected to continue. While eco-friendly and sustainable projects are increasingly popular and often marketed as environmentally responsible, it is important to recognise that, despite their sustainable features, these developments may not always be the most effective way to preserve Phuket’s natural environment.
More regulatory measures may be needed to protect significant portions of the island’s natural habitat from development. While eco-friendly projects may be preferable to conventional developments that overlook sustainability, preserving Phuket’s natural landscape in its original state is essential for both environmental health and community well-being.
Featured development: Botanica Wisdom in central Thalang
Illustrative of the expansion of property development inland, Botanica Wisdom is set in the peaceful countryside of Thep Krasatti in central Phuket. This striking, modern Zen-styled villa development is strategically positioned next to the renowned UWC International School, making it especially appealing for families seeking proximity to world-class education.
The project is also within walking distance of the prestigious Thanyapura Sports and Health Resort, offering a well-rounded lifestyle that integrates comfortable living, education, health, and leisure.
Brought to you by the highly successful Phuket developer, Botanica Luxury Villas, Botanica Wisdom comprises 68 meticulously designed single-storey pool villas arranged in a U-shape around a private swimming pool.
Each villa features three spacious bedrooms, including two master suites with direct access to the poolside terrace, and open-plan living and dining areas complete with a fully equipped kitchen and breakfast bar. These elements create a seamless transition between indoor and outdoor spaces, fostering a sense of harmony with the surrounding natural environment.
The development’s modern architecture and functional layout cater to those who desire a peaceful yet luxurious lifestyle, embodying the eco-friendly ethos that is gaining traction in Phuket’s inland projects. Covering a land area of 66,135 sqm, with villas set on plots ranging from 461 to 984 sqm, Botanica Wisdom offers spacious living that prioritises comfort and quality.
Residents benefit from a range of facilities, including a jogging lane, gardens, a children’s playground, a clubhouse, and 24-hour security. Essential services such as estate and rental management enhance the overall living experience.
Situated less than a 10-minute drive from major shopping centres like Lotus’s, Makro, and Robinson Lifestyle, and approximately 15 minutes from Nai Yang and Nai Thon beaches, Botanica Wisdom perfectly balances tranquillity with accessibility.
This project epitomises the inland development trend in Phuket, driven by the demand for residential options that combine proximity to key amenities with a luxurious tropical lifestyle.
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