Credit – The Financial Times
To cater for its new high-end buyers, bamboo huts have been replaced by gated estates with infinity pools and staff quarters.
Alex Garland’s bestselling 1996 novel The Beach inspired a generation of backpackers to beat a trail to the Gulf of Thailand. They kicked back in hammocks on Koh Samui’s sugary beaches, grew dreadlocks and danced under a full moon, while dreaming of finding their very own secret beach, just like Garland’s disenchanted protagonist.
Fast-forward 20 years and the once bohemian globetrotters are all grown up — and while many of them still love Thailand, they are looking for a more sophisticated experience with all the facilities and convenience of home.
Koh Samui has simultaneously evolved to fit the bill, and has now completed its journey from hippie hang-out to chic, upmarket resort with a thriving gastronomic scene. Bamboo huts have been replaced by gated estates with infinity pools, iPod stations and staff quarters.
Nick Thatcher of local agency Thai-Real.com, who moved to the island 12 years ago “to escape the grey” of the UK, says the area is attracting international investors, including those who might have padded barefoot along the same beaches during their gap years. “Typically they have become bankers, made money and now they want to spend their bonuses on a villa.”
Until five or six years ago there was no interest from major developers, he says. Yet with Phuket about to reach developer saturation point, Koh Samui is next in line, and is now the second-most advanced of Thailand’s islands.
Hotel chains such as Banyan Tree, W and Six Senses are some of the international brands that have changed the face of the resort, says John Kinder, an investor in Samujana, a 27-villa development in the island’s north-east. “Samui used to be Phuket’s poor cousin, but it is now attracting a lot of the top-end brands. They are very different places though. Samui is much smaller and you can’t fly long-haul here, so it has much more of an island feel.”
More direct flights from regional financial centres such as Singapore and Kuala Lumpur have brought investors from Asia and Australasia, as well as European expats, says Thatcher, helping property prices to rise about 10 per cent a year for the past three years. Four-bedroom villa within the Rockwater Estate, $1.13m
The most popular areas are around the beaches of Plai Laem and Choeng Mon in the north-east. As well as being near the nightlife of Chaweng Beach — a 3km stretch of sand hosting many top resorts — the area is close to international schools and the airport. Sotheby’s International Realty is selling an ultra-modern four-bedroom villa near Chaweng for Bt46.8m ($1.35m).
Rupert Wilmott of RSBuilt, a company that builds homes to order, says the majority of his clients — who are predominantly French and British — want villas with at least three bedrooms to appeal to the rental market. Many investors — who tend to spend about a month per year on Samui — hope to rent their properties to cover their costs, and some developments offer full rental management. Samui Island Realty is selling Villa Tiga, a four-bedroom home set within the fully managed Rockwater estate, for Bt39m ($1.13m).
Six-bedroom villa on the Samujana resort in Choeng Mon, $5m Even farther into the north-east corner, a six-bedroom villa in the Samujana gated development in Choeng Mon is on the market for $5m. The property has 11 bathrooms, an oversized infinity pool, fully equipped gym and private cinema in addition to multiple lounge and entertaining areas. For this kind of villa, owners can expect a rental return of 2 to 3 per cent a year, says Kinder — with a guaranteed return negotiable.
While the north-east is increasingly built up, the south has a different atmosphere, with mountain views and very little development. Thai-Real.com is marketing an 11-bedroom villa on its own headland in Laemsor in the secluded south-west for Bt325m. The property has spectacular views over the islands of Koh Taen and Koh Madsum, two pools and a private walkway to the beach.
The political upheaval that culminated in Thailand’s military coup in May 2014 had little effect on island life and the market recovered after slowing down for a few months, according to Thatcher. Bomb attacks in the country this summer have not been linked to international terrorism. Kinder says that security is less of an issue on an island where the indigenous population is small and relies on tourism. “Of all places in Thailand, Samui is in the best shape to weather any tension,” he adds.
Even so, the first elections since the military junta took power are expected to be held in late 2017, which could see a return to unrest in the capital, Bangkok. As the poll approaches, potential investors will no doubt also be on the lookout for trouble in paradise.
Buying guide
● Thailand has strict property ownership laws. Foreign nationals can own property freehold but not the land, so must either set up a Thai company to hold the freehold of the land or lease the land on a rolling 30-year lease
● Title deeds for Koh Samui are held at the Surat Thani Provincial Land Office. Buyers should always engage a lawyer to check deeds, access and that the house was built according to permits
● Money used to purchase property must come from overseas as a foreign currency, which effectively bars foreigners from borrowing locally
Credit – The Financial Times
https://www.ft.com/content/a3ee8fbe-8642-11e6-8897-2359a58ac7a5