Premium Housing in Thailand: Phuket or Pattaya?

Premium Housing in Thailand: Phuket or Pattaya?

In 2022, Russians ranked first among foreign nationals interested in purchasing real estate in Thailand, overtaking Chinese buyers. Russians are attracted to Thailand not only for tourism or permanent residency but also for real estate investment.

Compared to other popular countries, real estate prices in Thailand, especially in new developments, are very appealing due to their relative affordability. For instance, apartments in modern buildings can be purchased for $20,000, while $30,000 can buy a unit in a newly renovated complex with a pool and other amenities, just a few hundred meters from the beach.

If you are considering buying property as an investment, the best places in Thailand are Pattaya and Phuket, both offering a wide range of premium residential properties. These destinations are hugely popular among both tourists and locals.

CONTENT:

1. Comparison of Geographical Features: Pattaya − Mainland, Phuket − Island
2. Comparison of Real Estate Options: Pattaya − Apartments, Phuket − Luxury Villas
3. Real Estate Cost Comparison: Pattaya is Cheaper
4. Comparison of Rental Costs
5. Comparison of Tenants: Phuket − for Beaches, Pattaya − for Entertainment
6. Comparison of Return on Investment: Phuket Ahead
7. Conclusion

COMPARISON OF GEOGRAPHICAL FEATURES: PATTAYA − ON THE MAINLAND, PHUKET − ON THE ISLAND

Let's start by comparing geographical features. Pattaya is a mainland city located along the Gulf of Thailand, known for its mild climate. There are no large waves or extreme weather conditions, which means properties are rented year-round. Even during the rainy season, tourists continue to visit Pattaya, as showers are typically brief.

Phuket, on the other hand, is an island separated from the mainland by a small strait and surrounded by the Indian Ocean. While the weather in Phuket can be more unpredictable, the island is famous for its clear waters and beautiful beaches. It’s important to note that the rainy season in Phuket lasts from May to October, often bringing continuous rainfall. As a result, tourist numbers drop in the summer months. However, in 2022, due to the challenging circumstances in Russia and Europe, many properties in Phuket were rented out even during the low season, though this trend may not continue in the coming years.

COMPARISON OF REAL ESTATE OPTIONS: PATTAYA − APARTMENTS, PHUKET − LUXURY VILLAS

Pattaya is primarily a local city, with most of its housing stock consisting of apartments. While there are townhouses and some villas available, the selection of villas is not as varied or extensive as on the islands, and they tend to be smaller.

Phuket, being more of a tourist destination, offers a mix of condominiums and luxury villas. Additionally, the island offers investment properties such as residences with hotel management, which generally yield a lower income than renting out standard residential properties with the help of real estate agents.

REAL ESTATE COST COMPARISON: PATTAYA IS CHEAPER

According to the sales statistics for 2022, property prices in Pattaya are much lower than in Phuket. For example, in central Pattaya, the price per square meter of real estate is $1,915, whereas in Phuket it reaches $2,904. The difference becomes even more pronounced outside the central areas. This is due to the fact that in Pattaya, not only investors but also Thai citizens purchase medium- and economy-class housing.

If you are looking for luxury villas in Thailand, Phuket is the place to go. Prices for luxury villas start at $100,000 and can reach up to $20 million for ultra-luxury mansions on the island's coast. New apartments in Phuket are available from $45,000.

In Pattaya, property prices are significantly lower. A local apartment can be purchased for $20,000, and a residence in a new complex for $30,000. Houses in Pattaya start at $35,000, while luxury townhouses are priced from $70,000.

COMPARISON OF RENTAL COSTS

As expected for a tourist island, rental costs in Phuket are significantly higher than in Pattaya. The rental price difference is at least 25-30% for most types of properties, except for 1-bedroom apartments. Interestingly, in Pattaya, you can earn about $60 more per month renting out a 1-bedroom flat compared to Phuket, where villas are more in demand among tenants.

Renting out a house in Pattaya brings about $200 per month, while renting out a villa in Phuket starts from $600 per month. Additionally, short-term rentals are especially popular in Phuket.

COMPARISON OF TENANTS: PHUKET − FOR BEACHES, PATTAYA − FOR ENTERTAINMENT

Pattaya is known for its vibrant nightlife, attracting a younger crowd looking for affordable housing. Therefore, when investing in real estate in Pattaya, studios and 1-bedroom apartments are good options to consider.

Phuket offers a more tranquil and family-friendly vacation experience. Tourists come to Phuket for its natural beauty, beaches, and the ocean. Residences near the sea are in high demand, and visitors typically seek luxurious, comfortable accommodations rather than budget options. Villas and condominiums with excellent amenities are the most sought-after properties on the island. In recent years, there has been a noticeable trend towards renting or buying more spacious properties.

COMPARISON OF THE PERCENTAGE OF RETURN ON INVESTMENT: PHUKET AHEAD

When comparing the return on investment, rental properties in Pattaya provide a yield of about 5-5.4% annually on invested capital. In Phuket, the return is higher, with luxury villas bringing in 8-10% per year.

CONCLUSION

Real estate in Thailand remains in high demand among citizens of many countries. Although property prices have not yet started to rise sharply, experts predict significant price increases in the best areas of the kingdom in the coming years. To capitalize on this trend, it is advisable to choose your preferred area and invest in property now.

While real estate in Phuket may be more expensive, it promises higher returns. However, during the rainy season, many properties remain vacant. In contrast, Pattaya offers more affordable housing that can provide a modest income year-round.

After weighing the pros and cons, investors can find a suitable option in either Pattaya or Phuket, depending on their budget and goals.