Phuket Property Market Remains Stable

[george]

Property investors still eye Phuket

PHUKET: -- Despite the dramatic downturn in tourism since the tsunami, Phuket's property market has remained stable over the past six months with prices in some segments even rising.

"As a result of the tsunami, the media have made Phuket a well-known place. A lot of property investors and buyers are now interested in the market," said Norbert Witthinrich, managing director of the developer SEA Property Phuket Co Ltd.

He said Phuket was still very attractive to European property investors. Villas priced at 10 million baht in Phuket would cost up to 30 million baht in Majorca, Spain's most famous resort island, and compared to London, property prices in Phuket are a bargain.

The 46-year-old German developer pointed out that villas in Phuket were especially attractive to two markets. The first is retirees from Europe aged 50-60 years who want to relocate. Villas priced between eight million and 15 million baht are seen as suitable for this group.

The other key market is high net worth individuals from Europe and Hong Kong who want to buy a villa on a resort island to use as a second home. Villas for this group are priced at around US$1 million _ a fraction of their net worth.

Mr Witthinrich said houses in Phuket priced at 10 million baht represented a good market with most of the customers being European, especially British.

Last year, Mr Witthinrich set up a joint venture with a local developer to build a 100-unit project on 250 rai located between Chalong and Phuket Town. The 1.5-billion-baht project is called Ban Prangthong.

He recently set up another firm called Phuket Nature Home Co, to develop a second joint venture called Phuket Private Lagoon, with another local developer.

The new project worth 300 million baht will be located on 22 rai on Chaofah West Road. After its launch in mid-May, 13 townhouse units priced at 4.2 million baht were booked with most of the buyers being local businesspeople.

Thanusak Phuengdet, Phuket Nature Home's managing director, said competition in the Phuket property market was not heavy because each developer was looking to find his own niche.

"There now is a slowdown in housing sales but it will likely be for only a short period. Many ongoing property projects in Phuket did not come to a halt after the tsunami. Banks still support developers as they are confident in Phuket's economy," he said.

Meanwhile, land prices on the island have not dropped. A lot of land sales transactions are now taking place, mostly involving newcomers to the market.

"New investors optimistically believe that their project investments will be completed before the next peak season in Phuket. Most likely they will take one or two years to complete," said Mr Thanusak.

--The Post 2005-06-28

[george]

Foreign investors still confident of Thai economy, says PM

BANGKOK: -- Prime Minister Thaksin Shinawatra yesterday disclosed foreign investors and economists remained confident of the Thai economic growth despite a spate of violence in the deep South.

Speaking after a 2-hour meeting with more than 50 foreign investors and economists, he said most inquired how the infrastructure mega projects would go ahead and where the capital would come from.

They also wanted to know whether Thailand would be able to compete with China and India in the future.

Most viewed the mega projects deserved implementation, but worried about the import of too much raw materials and products to support the projects.

The premier said he clarified that the raw material import would represent only 30% of the total investment.

“Foreign investors and economists want to know about the country’s trade deficits. We assure them we can cope with the problem. Also, we will push for a barter trade and supplier credit, which can help ease the trade deficit,” he said.

On the persistent unrest in the three southern border provinces, he said, foreign investors wanted the government to tell them how and how long it could control the situation.

While most foreign investors were still confident of the economy, he said, local investors had little confidence in investment.

He conceded some local investors might panic about situation partly because they, unlike foreign investors, failed to deliberate economic figures in the long run.

On some forecasts that the country’s gross domestic product would reduce to 3.7% this year, Mr. Thaksin said: “it should be better than that because we never stay still. We continue to do away with problems all along.

“But should the GDP grow less than forecast, the unemployment will increase as there is a number of new graduates, who fail to get jobs,” he said

--TNA 2005-06-28