Sales of resort condominiums and apartments on the Thailand island of Phuket saw a decline during Q1 2015 versus the same period last year, according to new research from CBRE Thailand.
In its Phuket Residential Marketview report, the real estate firm revealed than 40% of units that were sold during Q1 were one-bedroom units, with 35% being studio apartments.
It cited the 53.9% decline in Russian tourist arrivals to the island, and said this has hit the number of Phuket condominium and apartment sales.
CBRE, in its report, said: “We saw the first real evidence of Chinese (PRC) buyers starting to buy resort property condominium units in Phuket. This number is significant in certain projects.”
It also noted that a small number of Thai investors also purchased units with rental schemes during the quarter. Western expatriate buyers, is said, are more cautious in their investments and prefer the resale market, where sales have happened but prices are not publically avalable
It also noted how competition in the resort condominium market in Phuket has remained fierce, especially at the lower end of the market, and rental schemes have become an increasingly important marketing tool for developers.
CBRE said this will mean increasing numbers of condominium developments will be competing with hotels for daily guests, and rental returns will depend on the overall performance of the Phuket hotel market.
In summary, CBRE said: “Going forward we expect slow sales and a limited number of new project launches. Unit sizes will become smaller, as will lump sum prices.
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