Phuket’s Long-Term Rental Market: 7 Surprising Trends You Can’t Ignore
Phuket, Thailand’s tropical paradise, has long been a magnet for tourists and expats alike. But beneath the surface of its bustling short-term vacation rentals lies a dynamic and evolving long-term rental market. Whether you’re an investor, property owner, or potential renter, understanding the current state of Phuket’s long-term rental scene is crucial. In this comprehensive analysis, we’ll dive deep into the trends, challenges, and opportunities that are shaping this vibrant market.
The COVID-19 pandemic has dramatically reshaped Phuket’s long-term rental market. With international tourism on pause, many property owners pivoted from short-term to long-term rentals. This shift has created a unique opportunity for those seeking extended stays on the island.
How has the pandemic affected rental prices?
Initially, prices dropped due to decreased demand. However, as digital nomads and long-term visitors such as Russians have returned, prices have reached the all-time high in many areas.
2. Hot Spots and Emerging Neighborhoods
While areas like Patong and Kata remain popular, we’re seeing increased interest in less touristy locations such as Cherngtalay as well as more residential parts of the island. Chalong, Rawai, and parts of Kathu are emerging as hotspots for long-term renters seeking a more authentic Thai experience.
Which areas offer the best value for long-term rentals?
Chalong and Rawai currently offer a good balance of affordability and amenities, with prices averaging 15-20% lower than more central locations. Cherngtalay, Layan and Bangtao are also good for high ROI but property purchase prices are the highest in this part of the island.
3. The Rise of Digital Nomads
Phuket is rapidly becoming a hub for digital nomads, driven by its improving infrastructure and Thailand’s new long-term visa options. This influx is creating demand for properties with high-speed internet and dedicated workspaces.
What amenities are most important for digital nomad renters?
Reliable high-speed internet, comfortable workspaces, and proximity to co-working spaces are top priorities.
4. Sustainability and Eco-Friendly Options
There’s a growing trend towards environmentally conscious living in Phuket. Properties featuring solar panels, energy-efficient appliances, and sustainable building materials are commanding premium prices.
How much commission agents charge for Long Term Rentals in Phuket?
In Phuket rental property agents charge 1 month worth of rent as their commission when they rent out a property for 1 year. If they rent the property out for 6 month, then they charge 50% of the 1 month rent value as commission.
Anything less or more than 6 month, they usually calculate as 10%.
5. The Impact of Infrastructure Developments
Ongoing projects such as new international hospital Bumrungrad International Hospital, the new underpass in Heroine Monument, new airport in Phang Nga, getting all the attention to northern part of the island. Many reputable property developers have been launching their new projects on the northern part of the island.
Rental prices are still rather low, but once these projects are completed, we predict a high increase on the rental prices.
How much deposit is normally collected in long-term rentals?
The common practice in Phuket is 2 months worth of rent + 1st month rental fee to be collected when check-in for long-term rentals.
Tenants usually try and negotiate it make it down to 1 month deposit + 1 month rent, but that depends on the property owners.
6. Legal Considerations and Tenant Rights
Understanding the legal landscape is crucial for both landlords and tenants. Recent changes in Thai law have strengthened tenant protections, impacting contract terms and dispute resolution processes.
Who is responsible paying what?
Owner’s Responsibilities:
- Anything broken in the house without the tenant’s fault
- Common Area Fees
- Depending on the deal but in some cases gardening + pool maintenance + cleaning
Tenant’s Responsibilities:
- Utility Bills (Electricity, Water, Internet, Cable TV)
- Depending on the deal but in some cases gardening + pool maintenance + cleaning
- Air conditioner Units Cleaning
7. The Role of Technology in Phuket's Long-Term Rental Market
Social media, especially Facebook is the main platform for tenants and property owners to find each other. Since rental properties move so quickly, it is waste of time and energy to list them on agency websites these days. Most of the rental agents don’t even bother to create a website and operate only on Facebook.
To be able to find what you’re looking for, it is a good idea to join into some Phuket Property Facebook Groups. You will find so many agent posts as well as some posts directly by the owners.
Is it better to deal with the owner directly?
Depends on the case. But usually a good rental agent would save you so much hassle and headache. Some property owners are local and can’t speak good English. You can pass that bridge with a good local Thai rental agent.
There are more real estate agents in Phuket, than customers. So be careful to work with someone who has been in the market for some time. A newbie can make things more complicated and make your life miserable.
A good, knowledgeable and well-established real estate agent most likely have good relationship with the owners. Can cut you a good deal, negotiate on-behalf of you, and get your possible requests granted. Also can help with any issue that may arise in the future.
Phuket’s long-term rental market is at a fascinating crossroads. The interplay of post-pandemic recovery, changing demographics, and technological advancements is creating a dynamic and opportunity-rich environment. For investors, the key lies in understanding these trends and adapting to meet the evolving needs of long-term renters. For potential tenants, this shifting landscape offers a chance to secure high-quality, long-term accommodations in one of the world’s most desirable locations.
As we move forward, staying informed about market trends, legal considerations, and emerging hotspots will be crucial for success in Phuket’s long-term rental market. Whether you’re looking to invest or find your perfect tropical home, the opportunities in Phuket are as abundant as its stunning beaches.
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Do not hesitate to contact us if you have any further questions on the subject, or if you would like to know more about property in Phuket in general.
