Phuket's property market is often discussed in terms of villas, condominiums, beaches, tourism and international buyers.
But underneath all of those conversations is something much more fundamental:
Land.
Every villa needs land.
Every condominium project needs land.
Every hotel needs land.
Every new restaurant, school, wellness centre, retail destination and mixed-use development needs land.
And Phuket has a finite amount of it.
The island's geographical constraints have already influenced the direction of its property market. Krungsri Research notes that limited developable land has contributed to rapidly rising land prices, particularly in beachfront locations, while developers have increasingly focused on higher-end residential products.
LAND IS NOT AN INFINITE RESOURCE
A developer can build more units.
A new condominium can add more residences.
A mixed-use project can create another lifestyle destination.
But the underlying land remains finite.
This is particularly important in established coastal markets.
Areas that already have:
• International hotels
• Established restaurants
• Retail
• Beaches
• Schools
• Healthcare
• Infrastructure
• International residential communities
can become increasingly difficult and expensive places to assemble large development sites.
That creates a fundamental difference between adding supply and creating new land opportunities.
You can increase density.
You can redevelop.
You can change the use of a site.
But you cannot create another beachfront parcel in Bang Tao.
THE LAND PRICE STORY
Krungsri Research reports that Phuket land prices have been increasing by approximately 10–15% annually, with beachfront land becoming increasingly scarce.
That has consequences throughout the development chain.
When land becomes more expensive, developers have several choices.
Build fewer units at a higher price.
Build more efficiently.
Increase development density where regulations allow.
Move toward less expensive locations.
Or create a more sophisticated product that can justify the underlying land cost.
This helps explain why Phuket has increasingly attracted luxury villas, premium condominiums and branded residences.
The economics of expensive land tend to favour products positioned toward higher-value buyers.
FROM BEACHFRONT TO THE NEXT RING
One of the most interesting consequences of land scarcity is geographical.
When prime land becomes increasingly difficult to acquire, development can begin moving into the areas surrounding established markets.
We have already seen strong development around the broader Bang Tao–Cherng Thale ecosystem.
Current research also points toward locations such as Pasak, Bang Jo and Phru Champa, while Pa Khlok is identified as a potential emerging residential location.
This doesn't mean every surrounding location will become the next luxury district.
Instead, it demonstrates an important development pattern:
Established destination → surrounding land → infrastructure → new communities → expanding development corridor.
This is one of the key ideas behind PHUKET 360°.
DEVELOPMENT DOESN'T ALWAYS MEAN SPREADING OUT
Phuket's future development may not simply involve building farther and farther across the island.
It may also involve building differently.
The proposed new city plan is examining changes to zoning, building heights, Floor Area Ratio and development intensity. Colliers' June 2026 analysis describes a shift toward greater urban intensification in selected areas, alongside tighter infrastructure requirements and expanded conservation controls.
Recent reporting on the proposed plan describes potential building heights of up to 45 metres in selected orange zones and 60 metres in selected red zones, while lower-density areas would retain tighter height restrictions. The stated planning principle is to concentrate development in areas capable of supporting greater density rather than continually spreading development into remaining open land.
This is an important distinction.
The future Phuket may not simply be:
MORE LAND → MORE BUILDINGS
It could increasingly become:
BETTER-DEFINED ZONES → GREATER INTENSITY → PROTECTED AREAS
Of course, the proposed planning framework remains subject to the planning process and revisions.
THE CITY PLAN COULD CHANGE THE DEVELOPMENT MAP
Planning regulations are one of the most important pieces of Phuket's long-term property story.
The proposed new city plan could alter where certain types of development become possible and how much can be built on particular sites.
Krungsri Research says developers have already been acquiring land in anticipation of changes to Floor Area Ratio regulations, while the proposed plan could increase allowable gross floor area in some designated locations and reduce it in others.
That means investors should not look at land simply as:
“How much does one rai cost?”
The more useful question is:
“What can legally and practically be developed on that land?”
Two parcels with similar prices can have very different development economics because of:
Zoning
FAR
Height restrictions
Road access
Setbacks
Environmental requirements
Infrastructure
Topography
Utilities
Permitted use
Land value is therefore not only about location.
It is also about development potential.
SCARCITY DOES NOT MEAN AUTOMATIC APPRECIATION
This is an important distinction.
Limited land can support higher land values.
But that does not mean every property located on limited land will automatically appreciate.
Property markets can still experience:
• Oversupply
• Weak absorption
• Changing buyer preferences
• High service charges
• Poor project execution
• Legal complications
• Competition from newer developments
• Economic downturns
Krungsri Research estimates that the value of remaining residential inventory in Phuket reached approximately THB 193.7 billion at the end of 2025, highlighting the fact that strong underlying land constraints can exist alongside significant unsold housing stock.
That is why scarcity should be viewed as a structural factor, not an investment guarantee.
QUALITY OF LAND VS QUALITY OF LOCATION
Another distinction matters.
Not all land is equally useful.
A site may be:
Close to the beach but difficult to access.
Large but poorly connected.
Affordable but outside established demand.
Well located but restricted by planning rules.
Or expensive but capable of supporting a differentiated project.
This is why professional property analysis has to go beyond a map.
The question becomes:
What can this particular piece of land support?
And:
Who would actually want to live there?
INFRASTRUCTURE CAN CHANGE LAND VALUE
Land does not exist independently from transportation.
A new road can change accessibility.
A new airport can change regional connectivity.
A new school can change family demand.
A new retail or hospitality destination can change an area's lifestyle proposition.
Krungsri Research expects major infrastructure investment to support urban expansion and identifies projects including the Phuket International Airport Phase 2 expansion, Kathu–Patong Expressway, Muang Mai–Koh Kaew Expressway and proposed light rail as factors that could influence future development corridors.
The relationship is important:
Land + Infrastructure + Planning + Demand
When these four elements begin moving together, an area can change significantly.
But again, infrastructure announcements should not be treated as guaranteed property returns.
THE EMERGING PHUKET MODEL
The traditional Phuket development model was heavily concentrated around the island's established tourism destinations.
The emerging model appears more complex.
We may see:
Established coastal hubs
↓
Surrounding residential communities
↓
New infrastructure corridors
↓
Central-island development
↓
Eastern expansion
↓
Greater urban concentration in selected zones
Krungsri Research expects developers to continue expanding low-rise residential projects toward central Phuket and the eastern coastline as competition for land intensifies, identifying Pa Khlok as a potential high-potential residential location.
This doesn't mean the development map has been decided.
It means the signals are worth watching.
INVEST • LIVE • DISCOVER • FUTURE
INVEST
Land scarcity can influence development costs, product positioning and long-term supply. But investors still need to examine project quality, legal structure, demand, competing supply and realistic resale assumptions.
LIVE
Land scarcity also affects how people live.
As Phuket becomes denser in some areas, access to open space, schools, healthcare, retail and transportation becomes increasingly important.
DISCOVER
One of Phuket's greatest assets is its natural environment.
Long-term development therefore creates a balancing question:
How can Phuket accommodate more residents and visitors while retaining the landscape and character that make the island attractive?
FUTURE
The future of Phuket's property market may be shaped as much by planning and land-use decisions as by buyer demand.
Where development is allowed.
How much can be built.
What infrastructure accompanies it.
And what areas remain protected.
THE 360° TAKEAWAY
Phuket's long-term property story is not simply about how many people want to buy property.
It is also about:
How much land is available.
Where development can happen.
What can legally be built.
How infrastructure changes accessibility.
And whether demand can support the new supply.
Land scarcity does not automatically make every property valuable.
But it does make understanding the land beneath the property increasingly important.
The property may be what you buy.
But the land is part of what makes the property possible.
And in an island market, that distinction matters.
THINKING ABOUT INVESTING IN PHUKET?
Speak with Crown & Cove about your Phuket property journey.
👇 Connect With Us
🔗 lnk.bio/crownncove
📞 +66 96 646 8844
📧 sales@crownncove.com
🌐 crownncove.com
NEXT EPISODE
PHUKET 360° EP07
What Is It Really Like to Live in Phuket?
From property ownership to everyday life — what does living on the island actually look like?