2015 phuket villa - knight frank...source : knight frank thailand research and consultancy...

RESIDENTIAL RESEARCH

2015 Phuket Villa Market OVerView 2015

2

Market Overviewthe Phuket villa market has been adaptable in its product specification to the economic situation, and it remains positive over the years. Despite the financial crisis in 2008, the demand for villas was still rising. in 2015, developers entered into new area such as Natai and Yamu, suggesting a scarcity of land plots for oceanfront and seaview villa development in Phuket. in addition, the average price for oceanfront villas now reached its highest rate, at thB 347,500,000, a big jump within one year. this adds the category of “ultra Super Prime” villas in Phuket. Furthermore, the price also reflects the scarcity of land plots in Phuket as well as other product specifications developers added on to their projects, such as the maintenance and management by acclaimed international brands with a rental programme. although overall the demand is still increasing, the disappearance of demand from russian buyers resulted in a slight drop of 2 per cent in the sold rate from the previous year.

highlightS

Risinee saRikaputRaDirector, research and Consultancy

Supply Trendthe accumulated supply of Phuket villas was about 2,143 units at the end of 2015, an increase of 277 units from the previous year, or approximately 15.5 per cent. all new supplies are from 10 projects launched during 2015.

this year may mark a new era for the Phuket villa market because in the 2015 supply we now see a rise in the unit price as well as changes in the product specifications since the financial crisis in 2008. three projects, the estate at Mont azure, avadina hills, and anantara layan, are priced over uSD 10 million per unit with the usable area size of over 1,800 square metres and either oceanfront or seaview locales. they are considered to be “ultra Super Prime” villas, whereas projects in the past were considered “Super Prime”, such as andara Signature, Malaiwana, amanpuri, and Cape Sawan. Such projects were launched at prices below uSD 6 million per unit with the usable area size of below 1,500 square metres. Furthermore, after the financial crisis, a high proportion

FiGuRe 1

Supply of Phuket Villa between 2007-2015

“the phuket villa market is now at the point where prices have reached a new high of between usD 10 and 20 million per villa; this has been the case for just over a year, however it is unclear whether this is going set a new level of villa pricing in phuket that buyers can accept.”

souRce : kniGht FRank thailanD ReseaRch anD consultancy DepaRtment

• Theaccumulatedsupplyof

Phuket villas was approximately

2,143 units in 2015, an increase of

277 units from the previous year.

• Thecumulativedemandfor

Phuket villas was 1,643 units,

including 176 newly sold units in

2015. the sold rate shows a slight

drop of 2 per cent from the previ-

ous year.

• Theaveragepriceofnewly

launch oceanfront villas and seav-

iew villas jumped by 874 per cent

and 389 per cent, respectively,

from the previous year to new

high levels of thB 347,500,000

for oceanfront villas and thB

113,650,000 for seaview villas. in

the same period, the price of newly

launch non-seaview villas in 2015

increased by 10 per cent to thB

15,353,907 a unit.

3

RESIDENTIAL RESEARchPhUKET VILLA MARKET 2015

FiGuRe 2

Phuket Villa Supply, Demand & Sold Rate between 2007-2015

of villa developments were by local developers and the majority of villa types were economy to mid-range units with no seaview.

Our survey shows that over the years, the majority of villas are located in Bangtao, accounting for 37.6 per cent of all supply, while kamala came second at 16.4 per cent. this is because since the development of the laguna project, Bangtao has attracted several high-end, middle, and low-end developments. Bangtao remains a very sought after part of the island due to the range of facilities in the area whilst being close to the airport. however, in 2015, we now see villa projects entering new locations such as Coco Chalong in Chalong, Point Yamu by Como in Yamu, and Baba Beach Club in Natai. although Natai is in Phang Nga province, it is considered to be closer to Phuket and affords convenient access to the Phuket international airport. this move suggests that land plots in Phuket that can be developed into seaview or oceanfront villas becoming rare.

Demand Trendin 2015, the cumulative demand for Phuket villas was approximately 1,643 units, representing 76.67 per cent of the unit take up rate. the survey shows a slight fall of 2 per cent in the unit take up rate since the end of the previous year. Prior to the financial crisis in 2008, the main market for the Phuket villa included european and Scandinavian buyers and european expatriates working in hong kong or Singapore; after the crisis, the main buyers were russians. the annual take up units of Phuket villas from 2008 to 2010, or during the financial crisis, was below 100 units per year. the market picked up again in 2012 onwards, which saw the annual take up rise to over 200 units. however, the demand graph shows that the sold rate for Phuket villas have been increasing gradually throughout the surveyed period. the slight drop in 2015


to 176 units suggests a disappearance of demand from russians due to the economic crisis.

the motive to buy Phuket villas is mainly as a holiday home rather than renting out for income, and owners may sell them later on for capital appreciation.

Our survey of the demand for Phuket villas suggested that projects launched between 2013 and 2015 and priced below uSD 430,000 per unit were the most demanded. we also found that these villas are 2-4 bedrooms with no seaviews. examples include ka Villa and laguna Park: townhome, which have a sold rate of 86 per cent and 88 per cent, respectively.

Pricing Trendthe price of Phuket villas is largely determined by the views from the unit; therefore they are categorised into three types: oceanfront, seaview, and non-seaview. the oceanfront villas can achieve the highest price, followed by the seaview units.

in 2015, the price of the newly launch of oceanfront villa increased by 874 per cent to thB 347,500,000 from thB 35,675,000 per unit from previous year. the price for newly launch seaview villas also rose by 389 per cent to thB 113,650,000 from thB 23,257,800, whereas the newly launch non-seaview villas showed very little change in price for the whole period of study.

the graph shows a drop in price of oceanfront villas after 2008 mainly due to the financial crisis and partly to a change in product specifications to suit the main group of buyers at the time. the price of newly launch non seaview villas after 2008 was in the range of thB 10 and 20 million, and one- and two-bedroom villas became more available in the market. the unit size was also smaller, such as those of Saiyuan estate: Oriental and Saiyuan estate: Onyx. the rise in newly launched prices for both oceanfront and seaview villas in 2015 predominantly reflects that the availability of land plots in Phuket that can be developed into oceanfront or seaview villas are becoming scarce.

4

REcENT MARKET-LEADINg RESEARch PUbLIcATIoNS

Knight Frank Research, Reports are available at KnightFrank.co.th/Research

For the latest news, views and analysison the world of prime property, visit

KnightFrankblog.com/global-briefing

GLOBAL BRIEFING

Thailand Contacts

Phanom KanjanathiemthaoManaging Director+66 (0)2643 8223 ext [email protected]

Chaturawit Wattanaprukexecutive Director+66 (0)2643 8223 ext [email protected]

Surasak Limpa-Arayakulexecutive Director, head of Valuation and advisory+66 (0)2643 8223 ext [email protected]

Roong Sitthisankunchornexecutive Director, head of Property Management+66 (0)2643 8223 ext [email protected]

Marcus Burtenshawexecutive Director, head of Commercial agency+66 (0)2643 8223 ext [email protected]

Frank Khanexecutive Director, head of residential +66 (0)2643 8223 ext [email protected]

Risinee SarikaputraDirector, research and Consultancy+66 (0)2643 8223 ext [email protected] Phuket ContactNattha Kahapanaexecutive Director, knight Frank Phuket+66 (0)7631 8151 ext [email protected]

1h 2015 Phuket condominiumMarket

Important Notice© Knight Frank LLP 2015 – this report ispublished for general information only andnot to be relied upon in any way. althoughhigh standards have been used in the preparation of the information, analysis, viewsand projections presented in this report, noresponsibility or liability whatsoever can beaccepted by knight Frank llP for any loss ordamage resultant from any use of, reliance onor reference to the contents of this document.as a general report, this material does notnecessarily represent the view of knight FrankllP in relation to particular properties or projects. reproduction of this report in wholeor in part is not allowed without prior writtenapproval of knight Frank llP to the form and content within which it appears. knightFrank llP is a limited liability partnership registered in england with registered numberOC305934. Our registered office is 55 BakerStreet, london, w1u 8aN, where you maylook at a list of members’ names.

it also shows that the developers now focus more on the product specifications, such as the size of usable area of the plot, design and decoration, and the property management. For instance, the landscape and interior decoration of the avadina hills project in layan are designed by an acclaimed international landscape architect and interior designer. For a rental programme, villas at Point of Yamu are maintained and managed by the renowned international hotels and resorts brand, Como.

OutlookDespite the global economic problem and uncertainty of thailand’s political situation, the Phuket villa market still shows positive signs, with a growing level of demand and constant supply throughout these years. at the current

FiGuRe 3

Average Unit Selling Price of Newly Launched Villa in Phuket by Villa Type 2007-2015 ( Unit Price in THB Million )

Q1 2015 BangkokCondominiumMarket

Q2 2015 Bangkokcondominium market

1h 2015 BangkokSuper Prime and Prime Condominium Market

Q1 2015BANGKOK CONDOMINIUM MARKET overview

research

• Oversixyearsandaquarteryears,theaccumulatedsupplyofBangkokcondominiums,asofQ12015,was381,772units,increasingby3.7%fromQ42015.

• NewlaunchesofBangkokcondominiumsduringQ12015wasapproximately13,737units.

• Majorityofthenewcondominiumsupplywaslocatedintheperipheralarea,comprisingapproximatelyx.69.1%ofthetotalsupply.NThenewlylaunchedofcondominiumslocatedintheCBDandCityFringeareawasmadeup19%and12%,respectively.

• Thetake-uprateoftheoverallBangkokcondominiummarketdroppedto44.3%inQ12015,from46.9769%duringthelastquarterof2014.

• DuringQ12015,wehaveseentheasignificantincreaseofcondominiumsellingpricesintheCBDarea,increasingby8.2%,fromTHB182,797persquaremetreinthepreviousquartertoTHB197,779persquaremetre,whereasthesellingpriceofthecCityfFringecondominiumsincreasedby5.3%fromTHB142,108persquaremetreinthepreviousquartertoTHB149,676persquaremetre.

highlight


BangkokcondominiUm market Q2 2015


Super prime and prime Condominium market overview, 1H 2015


PHUKET condominiUmmarKET ovErviEw 2015

rate of supply, it will take approximately 2.5 years for the market to absorb the new units, even with the new supply. Our view is that the total number of villa units in future projects is likely to be small because land plots in Phuket are becoming rare and may not be well served by amenities nearby. in addition, villa projects generally take up a big size of land, so it is difficult to produce as many units as condominium. this results in an increase in price, especially for oceanfront villas. even though there are projects moving into the new areas such as Natai and Yamu, prices there will not rise as high due to lack of amenities nearby. we are now at the point where prices have reached a new high of between uSD 10 and 20 million per unit. this has been the case for just over a year, however it is unclear whether this is going to set a new level of villa pricing in Phuket that buyers can accept.


2015 phuket villa - knight frank...source : knight frank thailand research and consultancy...

Documents