Market Trends of Thailand Real Estate Industry
Growth in Tourism is Driving the Market
- Thailand had shown a gradual economic recovery from the COVID-19 pandemic in 2022, helped by rising international tourism arrivals. Real GDP growth had risen from 1.5% in 2021 to 2.6% in 2022, with growth momentum expected to improve further in 2023. Thailand's manufacturing sector showed some improvement in momentum, with the S&P Global Thailand Manufacturing PMI for February 2023 having shown strong expansion.
- As COVID-19 border restrictions were gradually relaxed in Thailand and also in many of Thailand's largest tourism source countries during 2022, international tourism showed a significant improvement during the second half of the year. The number of international tourist arrivals reached 11.15 million in 2022, compared with just 430,000 in 2021. However, the total number of visits was still far below the 2019 peak of 39.8 million, indicating considerable scope for further rapid growth in the tourism sector during 2023.
- International tourism arrivals in the first quarter of 2023 surged to 6.5 million visitors, which was more than half the total number of international tourist visits in 2022. Total tourism receipts in the first quarter for both domestic and international tourism spending was estimated at 499 billion baht (USD 14.28 million), up by 127% y/y. The Tourism Authority of Thailand has increased its estimated target for international tourism visits in 2023 to 25 million, which is more than double the total number of international tourism arrivals in 2022.
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Phuket’s real estate market is experiencing a significant surge in demand
- In 2023, Phuket’s real estate market is experiencing a significant surge in demand, driven by both local and foreign investors. The island’s stunning natural beauty, vibrant culture, and thriving tourism industry, as described by Phuket.Net, have made it a sought-after destination for property investment. The increasing foreign demand is contributing to a notable boom in the real estate market, with experts predicting a positive outlook for 2023.
- The changing preferences of buyers, influenced by evolving lifestyles and technology, are shaping the demand for specific property types in Phuket.
- Phuket stands out as a prime destination for property investment in Thailand due to its natural beauty, strong tourism industry, and well-developed infrastructure. These factors create a desirable living environment, offering a blend of lifestyle benefits and financial returns. The island’s economic stability, infrastructure development, and attractive rental yields further enhance its appeal as an investment destination.
- The real estate market in Phuket is witnessing a significant increase in demand. One particular area of interest is Pa Sak-Kok Tanot Road, Thalang, where lands are being sold at a premium price of at least 14 million baht per rai (approximately USD 448,000 USD), with a price increase of 20-30%. These lands are being developed into luxurious pool villas, which have been increasingly in demand among tourists and foreign investors.
