Introduction:

Trends

• Branded developments continue to enter the market, with additional product coming online.
• Luxury villa sector continues to outperform the market.
• Tight credit conditions may cause project delays and a slowing of sales pace near-term.
• Global financial turmoil and Thai political worries have impacted 4Q 2008 villa sales and may also result in a slow start to 1H 2009.
• Availability of prime land in traditional areas continues to shrink and Phuket development pushes North and East in search of the perfect ocean view.
• For those with capital (purchasers, investors or developers), there will be opportunities to benefit from any temporary softening.
• Luxury villa supply strong with over 300 units priced over THB 65 million in the market limited but new supply is limited.
• Our medium term outlook for Phuket’s luxury villa market remains positive.

Forward Outlook

• Upcoming luxury supply includes some prestigious branded newcomers to Phuket.
• As availability of prime land continues to shrink, boutique developments will become increasingly common.
• Evolving tourism sectors introduce a new set of potential investors to the real estate market.
• The marina market continues to be a developing story in Phuket’s East.
• Infrastructure development continues to support high-end tourism and luxury residential projects.