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What Million Gets You in Luxury Real-Estate in Phuket, Thailand

What $8 Million Gets You in Luxury Real-Estate in Phuket, Thailand

May 13, 2022

by Jerry Schmidt Luxury Real Estate

I got an inside look at two villas on the Thai island of Phuket.
While they were listed at similar price points, they offered very different takes on island living.
The $7.9 million villa had a gleaming, ultra-modern feel to it, while the $8.6 million villa was timeless and sanctuary-like.

Phuket, Thailand’s biggest island, is flush with villas: In the past decade, the Southeast Asian island’s villa stock has more than quadrupled to a total of 4,000 luxury homes.

On a recent reporting trip to Phuket, I followed real-estate agent Norbert Witthinrich around for a morning to get a sense of the island’s luxury real-estate offerings. Phuket is only 13 miles wide and 30 miles long, and while the island is famous for its sandy beaches, the highways that traverse the island are often clogged with traffic.

I met up with Witthinrich on a weekday. He’s originally from Germany, has lived in Thailand for 25 years, and founded and runs real-estate agency Sea Property Group.

Witthinrich, I found, is punctual and excitable: We raced east across the island to the first villa, through it, then cut west across the island again to and through a second villa and back to his office, all in the perfectly timed span of two hours.

Here’s a look at what roughly $8 million can buy you on the Thai island of Phuket. Sea Property Group has both listings.

First up: A modern five-bedroom villa on the island’s east coast

Price point: 268 million Thai baht ($7.9 million)

The specs: 5 beds, 6 baths, infinity pool, indoor entertainment area, private beach access

The east coast of Phuket is less developed than the west, Witthinrich told me. We hopped into his car in Cherngtalay and headed for the east-coast development of Cape Yamu. The highway was a hectic scene, but as we approached the cape, I saw what he was saying: The highway gave way to ocean vistas, smaller roads, and a less-developed feeling. Fishing boats were tied up by the beach, and small shacks stood on prime oceanfront real estate.

The villa is part of a gated development, and after we passed the guardhouse, we parked in a very steep driveway.

“Step inside,” Witthinrich said, speed-walking ahead of me and throwing open the front door, “and let’s talk about luxury.”

Exterior of a villa in Phuket surrounded by trees — The entrance to the $7.9 villa on Phuket’s east coast.

The decor of the home was modern and maximal — think huge driftwood-inspired installations and matte black chandeliers. The house knows its biggest asset — its ocean view — and every room was designed to capitalize on it.

Interior view of Phuket villa with wood installations and a massive window that opens up to the sea — This is the view immediately upon stepping into the house.

On the left side of the photo above, you can see the stairs leading downstairs to the entertainment area, some more bedrooms, and the pool.

Here’s a shot of the kitchen, which opens right up to a patio:

A bare marble countertop with large sliding doors behind it and an ocean view. — The kitchen is big, but it’s not particularly well-outfitted.

Here’s a final shot of the main dining area, this time taken with my back to the ocean, that shows off the room’s design:

Interior of a home with white furnishings and a high ceiling in Phuket — The main living space in the villa was enormous, airy, and well-outfitted.

Parting thoughts: It’s full of shiny surfaces and modern finishings and has a killer ocean view. One of the bedrooms is in a separate house. The kitchen is more of a coffee kitchen than a chef’s kitchen.

Next up: A Japanese-inspired villa on the west coast

Price point: 292 million THB ($8.64 million)

The specs: 4 beds, 4 baths, pool, movie theater, spa

In contrast to the gleaming surfaces of the first villa, the second had a timeless, wood-and-concrete theme going on. Like the first home, this villa, too, was designed to wow people with its greatest asset.

Here’s the view you’re greeted with once you enter the home’s gate:

Concrete stairs lead down to a pool with sleek wooden homes rising on either side — The villa is split into little sub-homes.

Each of the small buildings on either side of the staircase has a bedroom, a bar, a bathroom, and a walk-in closet. The wood finishing was beautiful, and each suite felt totally private.

Exterior of a modern wooden home with the ocean behind it — The exterior of an $8.64 million villa on the west coast of Phuket, Thailand.

A walk-in closet replete with a bench and all-wood finishes. — The walk-in closet has beautiful wood finishes.

The villa is built into a mountainside, so the entrance is on the home’s upper level. Take the central staircase downstairs and you’ll walk right up to the pool. To the left is the kitchen and dining space; to the right is another living space and more bedrooms.

A table and sliding door with a pool and an ocean view behind it — The communal living spaces are on the lower level, giving them a bit of a cave-like feel — which can be a welcome respite from the Thai sun.

Parting thoughts: This villa felt like a sanctuary. The finishings were timeless and minimal. Each of the bedrooms was basically its own mini house. Also, I did not realize until now that a bar is exactly what I need in my bedroom.

An island take on luxury

Both units I toured with Witthinrich are in gated communities. The second villa is part of Anantara, a hospitality brand that operates hotels, villas, and spas, so in addition to the villa, you also get access to the hotel amenities. The villa I toured is one of 30 Anantara villas in the same development.

What struck me about both homes is that while they were impeccably manicured — the wild, undeveloped feeling of the Thai jungle lay just beyond the communities’ borders.

As far as the market in Phuket goes right now, the middle and top of the market are booming. After the pandemic slump, foreign buyers started picking up property on the island in late 2021 as Thailand relaxed border restrictions.

Witthinrich said that homes in the $100,000-$500,000 range were in high demand before the pandemic. Now, demand has shifted to a higher price range, with those — like the ones we toured — in the $2 million to $10 million garnering the most interest.

“I would say 80{d4d1dfc03659490934346f23c59135b993ced5bc8cc26281e129c43fe68630c9} of our clients, they’re looking for the dream,” Witthinrich said. “You want the house in Phuket, you want the pool in Phuket.”

Phuket Real Estate Market Benefits From Its Location, Hong Kong Troubles

April 17, 2022

by Jerry Schmidt Luxury Real Estate

Villa sales in Phuket cratered during the pandemic, with sales dropping by 50{d4d1dfc03659490934346f23c59135b993ced5bc8cc26281e129c43fe68630c9}.
But luxury real estate on the island is making a rebound as Thailand opens up to international travelers.
In an inversion from pre-pandemic days, the middle and top of the market is booming, while entry-level purchases are lagging.

In the past decade, Phuket — Thailand’s beach-paradise island — has become a breeding grounds for villas. The island sits off the southwestern coast of Thailand and had, before the pandemic, attracted millions of international tourists every year.

The island’s villa supply has more than quadrupled in the past decade, from roughly 1,000 to 4,000 homes, per real-estate consultancy Knight Frank’s 2020 villa report. They’ve primarily served as holiday homes, but also as reliable investment purchases, with prices on the island on a steady upward trend.

On a trip to Phuket in late March, I spent three nights in Cherngtalay, on the west coast of the island. It’s been leading the building boom, accounting for more than 70{d4d1dfc03659490934346f23c59135b993ced5bc8cc26281e129c43fe68630c9} of the villas built in 2020. The quiet, upscale area is about 30 minutes south of the international airport and 30 minutes north of the madness of party scene Patong Beach. In town, I found Porto de Phuket, a big, open-air mall full of beach-shack eateries and boutiques selling flowing clothing. There was a mix of languages in the air (Thai and English, Russian and French) and a mind-boggling quantity of real-estate shops to be found.

Yui Nimpinij, a sales manager at global real-estate consultancy Knight Frank, has been living and working in Phuket for more than seven years. She painted a bleak picture of the pandemic scene. “2020 was flat,” Nimpinij said. “It was still not good at the beginning of 2021 because waves of Covid were hitting all over the world.”

In normal years, Nimpinij said, Knight Frank sells 400 to 500 villas in a year on Phuket. At the peak of the pandemic, sales dropped by 50{d4d1dfc03659490934346f23c59135b993ced5bc8cc26281e129c43fe68630c9}.

But, in the third and fourth quarters 2021, she said, things started to turn around. Thailand relaxed border measures for international travelers in November, which affected hospitality and real-estate industries alike.

“We were quite busy with foreign buyers because we opened up the country,” Nimpinij said.

Interior shot of a mansion with simple furnishings and a view to the ocean — “At the moment what I’m seeing from our client base here is that everyone coming in is very wealthy. They’re buying between $2 and $10 million,” Witthinrich said.

Rising demand in the upper end of the market

Just down the street from Knight Frank’s office is Sea Property Group. Its owner and CEO, Norbert Witthinrich, has been in real-estate sales on the island for 25 years.

Phuket was a buyers market until 2020, Witthinrich said. “Now,” he went on, “in the luxury sector, it’s shifting to a seller’s market. You don’t need to drop the pricing.” That’s particularly true in the $2 million-and-up sector. Before the pandemic, the biggest demand Witthinrich saw was in the $100,000 to $500,000 price range.

“At the moment what I’m seeing from our client base here is that everyone coming in is very wealthy. They’re buying between $2 and $10 million,” he said. “The smaller markets, $300,000 to $500,000, it’s not there anymore.”

Stuart Reading, the managing director of Banyan Tree Group’s property division, described the market on Phuket as an inversion of the pre-pandemic trend.

“What we’re seeing is an inverse of what we saw pre-pandemic, when that affordable entry-level segment was the most dominant,” Reading said. “Now it’s the midscale and the upscale luxury segments that are doing well.”

The change comes down to the arrival of a different type of buyer. “They’re buying homes as second homes, so they’re not as price sensitive,” he said.

Knight Frank findings show a similar trend: In 2020, the best-selling villas were priced at $600,000 or less, per the company’s 2020 market overview. That segment, Nimpinij said, is all but gone. “Buyers are looking for a good deal, a bargain deal — cuts of 30{d4d1dfc03659490934346f23c59135b993ced5bc8cc26281e129c43fe68630c9} or and more,” she said.

“The good deals are almost sold out. They’re becoming more challenging to find,” Nimpinij added.

More interest from Hong Kong buyers

Against the backdrop of ongoing political unrest and stringent Covid lockdowns in Hong Kong, the city-state is seeing an exodus of residents and expats alike. Some of that has been to Phuket’s gain.

Nimpinij said she’s fielded multiple requests from Hong Kong buyers, at least one of whom has bought a Phuket house sight unseen. Witthinrich pointed to a rise in demand from Hong Kong expats and Hong Kong Chinesse, the latter of which is a new market for Phuket. “You can see clearly a crest of demand for upmarket, sea-view properties,” he added.

“I think it’s a combination of worries — ‘my money is sitting in a bank with low interest rates, what’s going on with the stock market and currencies,'” Witthinrich said of the mindset that may be driving Hong Kongers to buy Phuket real estate right now. “Phuket is known in Hong Kong, and it’s easy to go, normally.”

“Hong Kong has always been a very good market for us,” Reading said of Banyan Tree, adding that he expects to see the trend continue: “With what’s happening in Hong Kong now and the influence of China, we’re going to see a lot of people looking to make a flight to safety out of Hong Kong.”

As for Russian buyers, whose spending power has been greatly diminished by the waves of sanctions their country is facing over the war in Ukraine, Witthinrich said the segment is non-existent right now: “We don’t have Russian buyers, because the money doesn’t come.”

Inbound interest is also coming from Europe, particularly from Europeans who have business connections to Southeast Asia, both Nimpinij and Witthinrich said. Part of this interest may well be from professionals who are finding themselves untethered from desks and able to capitalize on one of the Thai government’s two visa programs for foreigners, the Thai Elite Visa and the Digital Nomad Visa.

A window-lined living room with minimalistic furniture that opens up to a patio and a pool with a view — The change comes down to the arrival of a different type of buyer. “They’re buying homes as second homes, so they’re not as price sensitive,” Reading said.

Shift to lifestyle purchases

Islands from Hawaii to Spain’s Canary Islands are seeing a pandemic-exacerbated shift as short-term visitors stay longer and some visitors become full-time residents, The New York Times reported recently.

Phuket is no exception. Both Nimpinij and Witthinrich both said there’s been a shift out of holiday homes and into lifestyle homes, specifically those that attract families.

“When I moved here it was all holiday homes,” said Nimpinij. Now, seven or eight years later, more families are making their way onto the island. She said Phuket is catering to this very demographic’s lifestyle with a series of builds that include Blue Tree, a big aqua park, and Porto de Phuket, the very shopping mall I was describing earlier.

“There are two sections,” Witthinrich said of demand right now. “There’s one group of clients who are looking for their dream holiday home, a sea-view purchase.”

“But particularly for Hong Kong families, they are looking for a home. They’re looking for a place to stay,” he continued, adding that the demand is for multi-bedroom properties that are suitable for longer periods of time. “They are asking for schools.”