The Phuket property market in the second half of 2025 is characterized by international demand, particularly in the luxury segment, driven by lifestyle shifts and strategic investment, a focus on branded and turnkey properties, high rental yields, and strong, long-term investment potential fueled by tourism resurgence and infrastructure projects. 

While overall new project launches saw a decline in the first half of 2025, with condo and villa launches decreasing by 25.3% and 41.5% year-on-year respectively, according to reports from the Bangkok Post. This slowdown is attributed to factors like high market inventory, intense competition, increased price sensitivity, and a cautious approach from developers, despite the market's overall activity and high-value sales. However, a healthy sales volume is expected to continue, with significant activity anticipated in the high season (Q4). 

The market sees increasing demand for high-quality, amenity-rich residential communities in popular areas like Bang Tao and Cherngtalay, alongside expanding commercial offerings and a growing preference for sustainability and smart technology in new developments. Phuket developers are currently focusing on branded residences and high-end villas, developing wellness-integrated estates, and creating lifestyle-focused communities with modern amenities. 

There's a strong push to attract international buyers seeking long-term residency and remote work bases, particularly with high-end pool villas. They are also emphasizing environmental sustainability and leveraging the island's ongoing infrastructure development to enhance connectivity and long-term market stability.

Essential Insights

• Boom in Luxury Properties: High-end pool villas and branded residences are in high demand, attracting cash-rich international buyers, notably from Russia. This is transforming Phuket into a luxury real estate hub, with properties seeing high sales volumes, significant investment, and strong rental yields, though some concerns exist about potential market overheating.  
   
• Infrastructure Development: Significant upgrades are underway, including a substantial expansion of Phuket International Airport and new highway projects, enhancing the island's attractiveness and prospects for the property market. 
   
• Divergent Market Dynamics: Despite a decrease in new condo and villa launches during the first half of 2025 compared to the record-breaking 2024, the market volume remains healthy and is expected to pick up in the busy second half of the year. 
   
• Focus on High-Quality Developments: Successful projects are characterized by strong branding, prime locations, resort-style amenities, and flexible rental options to meet buyer expectations for privacy, security, and a premium lifestyle. 
   
• Focus on Prime Locations: Demand remains high for developments in developed areas near the beach where properties continue to sell quickly. Focus on prime locations as these areas offer high rental demand from tourists and expats, strong rental yields, and greater potential for property value increases. Prime locations include areas like Bangtao, Laguna, Cherngtalay, Kata, Karon, and Kamala, which are favored for their beaches, luxury amenities, and thriving tourism. 
   
• Increasing Foreign Interest: Favorable foreign ownership policies and sustained international interest in luxury properties contribute to market robustness. Expect more transactions and activity in both primary and secondary property markets as the high season approaches in the fourth quarter of 2025. 

Considerations for Investors

• Mid-Range Condominium Oversupply: Some market segments, particularly mid-range condominiums, may face oversupply, requiring developers to focus on differentiation and quality to succeed. 
   
• Rising Costs: The overall cost of construction, land, building materials, and labor is increasing, directly impacting the final price of new developments and profit margins.
   
• Partner with Local Experts: Work with experienced local real estate agents to navigate the market and find suitable opportunities. Clearly establish your investment goals, whether it's rental income, a holiday home, or long-term living, to guide your property search.
   
• Consider Off-Plan Investments: Early investors can often secure lower prices in off-plan developments, which can provide significant returns as construction progresses.
   
• Stay Informed on Policy Changes: Keep track of potential government changes regarding land lease terms and foreign ownership regulations, as these could significantly impact the market. 

The Bottom Line

Phuket in 2025 is firmly establishing itself as an international center for luxury property and wellness-focused living. While the luxury villa segment offers strong growth and rental yields, mid-range condominiums face oversupply risks. Investors who focus on prime locations, branded developments, and long-term infrastructure-driven growth are best positioned to benefit.

Looking for tailored advice on investing in Phuket property? Contact our local experts today to discuss opportunities before the Q4 high season begins.