It’s no secret that the pandemic has changed the whole world. These changes have affected absolutely all spheres of people’s lives around the world. That is why it is now very important to learn the new «rules of the game» and be able to adapt to them in time. Oleg Golubev, co-founder, sales and marketing director at Serene Condo Phuket, told Realting.com how he sees the Thai real estate market now and why some companies were not able to survive the consequences of the pandemic.

The uncertainty created by the pandemic in 2020 has gripped every market in the world, including the real estate market on our island. 

In order to analyze the past 2 years, I would divide the Phuket property market into 2 categories:

  1. Finished properties,
  2. Properties under construction or in pre-sale.

The market of finished properties experienced high turbulence, primarily due to the shortfall in projected rental income, as the tourist rental market was hit very badly. The capitalization and value of this kind of property suffered primarily in projects that decided to suspend rental activities during this period and wait for the return of «pre-Covid» prices, as well as reduced management and personnel costs. As a result, some apartments have lost their attractiveness and require significant investment to return to the market. The return of employees has also become difficult, as the labor market has significantly transformed during this time. At the same time, those who continued their operating activities have significantly benefited over this time: they set up the local rental market, were able to digitize and optimize their processes, and, most importantly, kept their property in excellent working condition.

Naturally, we saw the intentions of some owners to quickly sell their assets at low prices, although these were isolated cases. The villa market, on the contrary, has benefited from this situation and received an increased demand for premium real estate.

For the construction-phase real estate market, this time was very difficult, because it was very localized and largely dependent on the tourist flow. Also, due to the global increase in material prices, most companies have had to change their models and strategies. Unfortunately, a series of bankruptcies of some developers has taken place, while the share of these companies was not high. Naturally, the developers had to revise the deadlines for the delivery of facilities, and even in «non-pandemic» times, each developer had the legal right to delay the deadlines specified in the contract. Developers who had crisis strategies and were very flexible benefited from the pandemic. One of the most important changes has been a switch in the minds of people around the world and a tolerance for buying products such as real estate online, which has led to a new wave of sales.

The Phuket Sand Box tourism program has been operating in Thailand since July 2021. Many were skeptical about the quick return of prices, while, as practice has shown, business, tourism and real estate have been transformed very quickly and the current season in Phuket can definitely be called high.

Phuket is quite difficult to compare with other provinces in Thailand, because here, thanks to the local laws, a unique natural ecosystem has been formed (the island has untouched natural landscapes and an excellent ecology), but it also has a developed infrastructure (airports, shopping centers, entertainment, schools), thereby attracting not only tourists, but also people who would like to live here permanently.

These conditions allow real estate to retain its value and have long-term investment prospects.

I believe that in 2022 the winners in the market will be companies that pay attention to the digitalization of their companies, as well as to projects with a new modern vision aimed at health, quality of life and recreation, and conceptual projects. Customer focus and quality of service will also increase sales conversion and raise the overall desire to invest.

Oleg Golubev 
Co-Founder, Director of Sales and Marketing at Serene Condo Phuket