Justine Tondeur
June 1, 2026 · 15 min read
Phuket property has quietly shifted from a holiday indulgence into a working capital-preservation tool: in the first quarter of 2026, condominium transactions involving Russian buyers rose 33% in volume (383 units) and 69% in value (to 1.66 billion baht), making Russia the second-largest group of foreign buyers in Thailand ahead of Myanmar (REIC data, published by the Bangkok Post). If you are weighing where to place capital in Thailand so that the asset is tangible, legally registered in your name and actually earning, Phuket is one of the few answers that survives scrutiny by the numbers rather than by emotion.
What follows is a sober breakdown with no promises of “guaranteed returns”: why international buyers are moving into Phuket right now, what it realistically earns, how the money legally reaches a deal, and how the island differs from Dubai and Bali.
Key takeaways
- Demand is rising against the broader trend. In Q1 2026, Russian condo transactions in Thailand rose +33% by count and +69% by value, even as REIC forecasts the whole foreign condo-purchase market could soften by roughly 20% across 2026.
- Phuket leads on transaction value. In Q1 2026, Russian buyers accounted for about 44% of the total value of foreign condominium deals on Phuket (REIC / Bangkok Post).
- Yields are moderate but honest. Average gross rental yield on Phuket is around 5.8% (2025); well-located units reach 7–8.5% gross; net returns land near 5–10% depending on strategy (Colliers Thailand / C9 Hotelworks).
- The deal turns on money and law. To register freehold as a foreigner you need an FET form from a Thai bank; tax residency (from 180 days) has changed the rules on remittances since 2024.
- This is not “a second Dubai” or Bali. Phuket has its own logic: finite land, genuine freehold ownership of condos, and mature international infrastructure across the south and west of the island.
Why capital is moving into Phuket in 2026
The core reason is simple: against a backdrop of currency volatility and, for some buyers, capital-movement restrictions, Phuket property offers what a bank deposit at home cannot — a hard asset in a stable currency, held in your own name.
The numbers show this is behaviour, not talk. According to REIC (published by the Bangkok Post, corroborated by Nation Thailand), in Q1 2026:
- Russian condominium transactions rose +33% by volume (383 units) and +69% by value (1.66 billion baht);
- Russia became the second-largest group of foreign buyers in Thailand, overtaking Myanmar;
- Phuket recorded the highest transaction value of any province in the country.
Zoom into Phuket alone and the picture is sharper still: in Q1 2026 Russian buyers accounted for roughly 44% of the total value of foreign condo deals on the island (out of 2.43 billion baht across 420 units), and Russia was the only country in the top five to grow — per REIC / Bangkok Post.
A note on the figures. The often-quoted claim that “Russians own about 40% of foreign condos on Phuket” is an outdated estimate from around 2023 (CBRE/REIC), describing a share of the accumulated stock at that time. That is not the same as a share of quarterly transaction value. The correct current figure is the ~44% of foreign transaction value in Q1 2026.
What sits behind this growth is a demographic shift that applies to many source markets, not one: as arrivals rise, a share of repeat visitors convert into residents and buyers. Nation Thailand (citing tourism data) reports Russian arrivals to Phuket climbing from roughly 400,000 in 2022 to an estimated 1.1 million in 2025. A visitor returning for a fifth season, enrolling a child in a local school and working remotely is no longer a tourist — they are a candidate to relocate and buy. The same funnel runs for European, Middle Eastern and Asian buyers who spend part of each year on the island, drawn to the family-friendly zones in the south and west.
Phuket as a hard asset: demand against finite supply
The value of Phuket property rests on a simple market mechanic: demand keeps rising while land is physically finite. Phuket is an island of roughly 540 km², much of it national park, hillside and protected zones. Buildable land near the water on the western and southern coasts is scarce, and it is not getting any larger.
Yet prices remain rational by global-resort standards. Per C9 Hotelworks (Phuket Property Market Update, May 2025), the median condominium price on Phuket was around 144,000 baht per m² as of 30 April 2025 — about USD 4,000 per m² at the exchange rate of that period. For context within the market: non-branded new-build units averaged ~139,000 baht/m², while branded residences ran around 181,000 baht/m².
That combination — finite supply, structurally rising demand, and a moderate price base — is what turns the island into an asset rather than merely a place to holiday. It is also why “where to invest in Thailand” so often narrows to “which part of Phuket, and on what terms.” Our guide to the best Phuket zones to invest in breaks that decision down street by street.
An honest look at rental yields
Here it pays to be blunt: no one can guarantee a yield, and any “12% a year from the developer” should be read as marketing, not fact. Real market benchmarks are more modest and more reliable.
Per Colliers Thailand and C9 Hotelworks (2025):
| Metric | Gross yield | Comment |
|---|---|---|
| Phuket market average | ~5.8% | 2025 islandwide baseline |
| Well-located units | ~7–8.5% | Seafront / near strong infrastructure |
| Net yield | ~5–10% | After costs; depends on strategy and unit type |
The caveats an honest advisor is obliged to state:
- Gross is not net. Management, utilities, maintenance, vacancy and taxes all come out of the gross figure. Net yield is almost always meaningfully lower than gross.
- “Well-located” does not mean any unit. The 7–8.5% gross band is earned by specific, liquid units in the right locations — not by the average listing.
- Yield depends on strategy. Short-term rental, long-term lets and hybrid models produce different returns and very different levels of hassle.
If you want to understand what the numbers really look like once every cost is stripped out, our data-led piece on real Phuket rental yields 2026 works through the models unit by unit.
Diversification, liquidity and an exit strategy
For an international investor, buying on Phuket is first and foremost geographic and currency diversification: moving part of your capital into an asset denominated in Thai baht, outside your home financial system. That matters most for buyers from markets with capital controls or heightened currency risk — but diversification only works if the money actually reaches the deal and if you can later exit the asset cleanly.
How money legally reaches the deal: the FET form
A foreigner cannot own land, but can own a condominium unit on a freehold basis — within the building’s 49% foreign quota by floor area (Thailand Condominium Act). Two rulebooks meet here: the Condominium Act (Section 19 bis) sets the foreign-eligibility conditions and requires evidence that the purchase money entered Thailand as foreign currency, while the FET form (Foreign Exchange Transaction, formerly “Thor Tor 3”) is the document a Thai bank issues under Bank of Thailand foreign-exchange rules to prove exactly that.
The FET rules it is critical not to break:
- funds must arrive in Thailand in foreign currency (not converted to baht abroad first);
- the transfer must go to your own Thai bank account, stating the purpose as “purchase of property”;
- the bank issues an FET for inbound transfers of USD 50,000 and above.
An error here can cost the deal: if the bank converts the currency to baht offshore, or the money is sent straight to the seller’s or lawyer’s account, the Land Department may not accept the FET as valid.
Sanctions and SWIFT: neutral context, not a workaround
For some buyers — particularly from sanctioned markets — conventional bank transfers have become more complicated. As neutral background: since March 2022 the EU and its partners have progressively removed a number of Russian banks from SWIFT, and later packages across 2022–2025 widened those restrictions (European Council data). That is exactly why the routing of funds, and proof of their origin, has become a live practical topic for affected buyers. We cover the lawful mechanics separately in our piece on paying for a Phuket property: transfer, crypto and the FET form. To be clear: this is about legal payment routes, not circumventing any restriction.
On cryptocurrency specifically: you cannot “buy property directly with crypto” — the Land Department only registers a transaction in baht. Crypto can be lawfully converted to baht through a Thai SEC-licensed exchange or OTC desk, but baht obtained inside the country did not arrive from abroad as foreign currency, and so may not satisfy the FET requirement for freehold. Any such structure must be agreed with a Thai lawyer in advance.
Transaction costs and the exit
Liquidity is not only about “how you get in” but “how you get out without surprises.” Indicative Land Department costs (industry standard; the split between parties is negotiable):
| Charge | Rate | When it applies |
|---|---|---|
| Transfer fee | 2% of appraised value | On any transfer of title |
| Stamp duty | 0.5% | If SBT does not apply |
| Specific Business Tax (SBT) | 3.3% | If the seller sells within 5 years (replaces stamp duty) |
| Leasehold registration | ~1.1% of the lease value | For leasehold structures |
The practical takeaway for your exit strategy: selling within the first 5 years costs more because of the 3.3% SBT — worth building into your planning horizon. We compare the two ownership routes and give a full due-diligence checklist in the freehold vs leasehold complete guide.
Tax: what changed in 2024
One more layer you cannot ignore when moving capital. Since 1 January 2024, Thai tax residents (those spending 180 days or more in the country in a year, not necessarily consecutive) are taxed on foreign-source income remitted into Thailand, regardless of the year it was earned. Income earned before 1 January 2024 is exempt (Revenue Department orders Por.161/2566 and Por.162/2566, per the Forvis Mazars analysis).
Important caveats:
- A June 2025 proposal for a “two-year window” exemption on remittances is not yet law — do not plan around it.
- Long-stay visas such as DTV and LTR do not by themselves exempt remitted income from tax, and are not permanent residency or citizenship (the DTV also does not grant the right to work locally).
- This is general information, not personalised tax advice — model your remittance scenario with a tax specialist before you transact.
Phuket vs Dubai vs Bali: a quick comparison
These three destinations often sit on the same shortlist, but their logic differs. The comparison below is qualitative — with no invented figures for Dubai or Bali:
- Ownership rights. On Phuket a foreigner obtains genuine freehold on a condominium within the quota — a clear, registrable right. In Bali, freehold is effectively closed to foreigners, and the market leans heavily on leasehold and holding structures, which raises legal risk. Dubai offers freehold zones, but it is a fundamentally different product and market climate.
- Asset type and lifestyle. Phuket is an “island to live on as a family”: sea, nature, mature international infrastructure and schools across the south (Rawai / Nai Harn) and west (Bang Tao / Cherngtalay). Dubai is a vertical metropolis; Bali is a tropical market that is riskier on both law and infrastructure.
- Currency and stability. The Thai baht has historically behaved as a relatively stable Asian currency, which reinforces the “capital preservation” function without tying you to Dubai’s dollar peg.
The conclusion is not that “Phuket beats everyone,” but that for a household relocating for the long term and wanting a tangible asset with clean title, Phuket meets more of those needs at once. The full picture is in our complete Phuket investment guide 2026.
Checklist: how not to lose money at entry
- Check the title and quota. Confirm the unit falls within the building’s 49% foreign freehold quota, or knowingly choose leasehold.
- Plan the FET in advance. Transfer in foreign currency, to your own Thai account, ≥ USD 50,000 per transaction, purpose stated as “purchase of property.”
- Count net yield, not gross. Budget management, vacancy, utilities and taxes.
- Assume a ≥ 5-year exit horizon to avoid the 3.3% SBT.
- Assess tax residency (180 days) and your income-remittance scenario.
- Do not trust “guaranteed returns,” and verify the legal cleanliness of the unit with an independent Thai lawyer.
Common mistakes to avoid
- Sending money straight to the seller or lawyer — and ending up without a valid FET for freehold.
- Converting currency to baht abroad before transferring — the same FET failure.
- Treating a developer’s gross yield as if it were net.
- Assuming DTV/LTR is “residency” — it is neither permanent residency nor a tax exemption.
- Relying on the stale “40% of stock” figure instead of the current Q1 2026 data.
Frequently asked questions
Are foreign buyers really this active on Phuket in 2026?
Yes. Per REIC (published by the Bangkok Post, corroborated by Nation Thailand), in Q1 2026 Russian condominium transactions in Thailand rose +33% by count (383 units) and +69% by value (1.66 billion baht), and on Phuket Russian buyers alone accounted for about 44% of the value of all foreign condo deals. This happened even as foreign condo purchases were forecast to fall roughly 20% over the year — a signal that demand from several source markets is holding up against the broader trend.
What rental yield can you realistically expect on Phuket?
Colliers Thailand / C9 Hotelworks benchmarks for 2025: average gross yield around 5.8%, well-located units 7–8.5% gross, and net returns near 5–10% depending on strategy and unit type. These are benchmarks, not guarantees — always calculate net yield after every cost.
Can a foreigner fully own property on Phuket?
Land, no — but a condominium unit, yes, on a freehold basis within the building’s 49% foreign quota by area (Condominium Act). Registering freehold requires an FET form from a Thai bank, issued under Bank of Thailand foreign-exchange rules, confirming the funds entered in foreign currency.
How do sanctions and SWIFT disconnections affect a purchase?
Since March 2022 the EU and its partners have progressively removed several Russian banks from SWIFT (European Council data), complicating conventional transfers for affected buyers. This is neutral fact, not advice on circumvention: settlement must follow lawful routes with correct proof of the funds’ origin and a proper FET. We cover the mechanics in our dedicated article on paying for a Phuket property.
Do you have to pay tax in Thailand when you remit money?
If you are a Thai tax resident (180+ days a year), then since 1 January 2024 foreign-source income remitted into Thailand is taxed regardless of the year it was earned; income earned before 2024 is exempt (Forvis Mazars analysis of the Revenue Department orders). The relief discussed in June 2025 has not become law. Plan remittances with a tax advisor.
Phuket, Dubai or Bali — which is best for capital preservation?
It depends on your goal. For a household that values genuine freehold ownership of a condo, a stable currency, nature and mature international infrastructure for children, Phuket addresses more of those needs at once. Dubai is a vertical urban market; Bali is riskier on law (freehold is effectively unavailable to foreigners). There is no universal answer — your priorities and horizon decide.
The bottom line, and your next step
Phuket property in 2026 is not a bet on a “hot market” but a rational way to preserve capital through a tangible asset with clear ownership. The Q1 2026 numbers show buyers are already doing this — and doing it against the broader trend. But the outcome turns on the details: the right location, a clean legal structure, a correct FET, and a sober calculation of net yield.
Palmora Property helps you walk this path without expensive mistakes: Phuket market analysis, a shortlist of liquid units matched to your budget and horizon, and professional rental management after purchase. Tell us what you are trying to achieve and we will give you a specific, non-promotional answer. Reach us through our contact page, on WhatsApp at +66 61 249 4192, or at [email protected]. For more reading, browse the Palmora blog.
Disclaimer: this article is general information and does not constitute personalised legal, tax or investment advice. Rates, fees and rules can change. Before transacting, consult a qualified Thai lawyer and tax specialist — Palmora can introduce partners from its network. We do not promise guaranteed returns.
