Are you looking to relocate to Phuket, Thailand? If so, it can be hard to decide between renting and buying a property.
Weighing up the pros and cons of both options may help you make an informed decision. Additionally, understanding what the future holds for the property market in Phuket over the next few years is also important.
In this article, we will provide some insight into these points to help you decide whether buying or renting a property in Phuket is the right choice for you.
Deciding between renting and buying property in Phuket depends on your long-term plans and goals. Have you been to Phuket before? Are you certain it's the place for you? If you're only planning a short-term stay, buying a property may not be the most sensible option.
However, if you're considering living in Phuket for an extended period of time or if you're a real estate investor looking to take advantage of the generous rental returns that are offered, then investing in a property might just be the way to go.
Before coming up with a decision, consider your future plans carefully and weigh out the pros and cons of both renting and purchasing property in Phuket.
Generally speaking, buying is usually cheaper than renting in the long run as you'll own an asset that appreciates in value over time. Another advantage is that you are not paying rent to a landlord.
The downside of buying a property in Phuket is that the Thailand real estate market is very much a cash-buyer market, at least for foreigners. Getting a bank loan in Thailand as a foreigner is nearly impossible, and as with any investment, you should never put all your eggs in one basket.
In Thailand, the ownership structure might be a bit different than what you are used to back home. Condos can be owned outright without any issues, while owning land plots for villas and houses is not quite as straightforward. We recommend you check out our guide, "Can Foreigners Buy Property in Thailand". We have both written content and a video. If anything is still unclear, do not hesitate to drop us a message for a consultation.
Buying a property in Phuket is a very lucrative investment opportunity. The combination of high tourist influx and likely price appreciation of real estate over time - makes it a much smarter option than renting if your priority is return on investment rather than short-term accommodation needs.
Rental returns in Phuket have soared again after Thailand opened up to tourism again following the rather strict COVID lockdowns. As the main tourist destination in Thailand, Phuket has greatly benefited from the pent-up demand for travel following the pandemic.
Many condominium developments offer guaranteed rental returns of 5-7% for as much as 15 years, and up to 30 days free stay in your unit. Others offer you to partake in a rental management program, with no guaranteed returns but instead the benefit of more personal usage. Take a look at some options that offer guaranteed rental returns in Phuket, or contact us for a curated list of properties based on your requirements and budget.
On the flipside, while owners receives healthy rental returns from their properties, renting in the more popular areas can be quite expensive, even when signing for a long-term contract of one year or more. We have never seen as high demand as this year, and the rental prices reflect the demand. If you are looking to invest, now is the time.
If living in Phuket for a longer period of time is part of your intention, it might be worth purchasing property even if it means spending more money upfront, simply because rental homes come with limits such as fixed tenancy agreements and limited customization options.
Owning a property gives you much more control over being able to customize your home with specific features according to your individual tastes and preferences, as well as adding equity that can later be used for upgrades or renovations down the road.
If you instead plan to travel the world and do not care about rental returns or having a steady holiday home, renting might make more sense.
Whether you should buy or rent a property in Phuket depends on many factors. Let's summarize below:
Hopefully, you now have a better understanding of whether you want to buy or rent a property in Phuket. No matter if you decide to buy or rent, do not hesitate to reach out to us and we'll be happy to help you find your dream home.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full and managed with reasonable care, it is about the safest investment in the world.”
- Franklin D Roosevelt