Comparing Property Types in Koh Samui: Villas vs. Condos vs. Land Investments?

Right behind Phuket, Koh Samui is Thailand’s second largest island. It’s also an up-and-coming beachside tourist destination and realty investment source for the Land of Smiles. It’s only a few hours of travel to go from Phuket to Koh Samui for good measure.

With that said, if you’re a foreign investor who’s interested in investing in the Kingdom of Thailand, why not do so by purchasing a piece of property on Samui Island?

Truthfully, there’s a wide range of property for sale in Koh Samui to choose from. They can be separated into the following three categories.

What are Villas?

The first and most common property type in Koh Samui are villas for sale. Compared to houses, villas are much larger and come complete with a variety of amenities included with the property package deal.

• Villas vs. Houses: Villas are bigger than single-family houses or one-story bungalows. They’re characterized by their amenities that make them more enticing to purchase compared to empty houses you’ll have to furnish from scratch.

  They also typically include landscaped gardens and swimming pools of some form, like Infinity Edge pools or Olympic-sized pools.

  If you wish to buy a Koh Samui sea-view or beachside villa for sale, you’ll have to pay extra compared to mountain-view or garden-view villas.

• Standalone Villas vs. Duplex Villas: Unlike standalone villas, duplexes have common-wall rooms or shared walls between one another, like the villa equivalent of townhouses. You typically buy one of a set of duplex villas while sharing space with neighbors.

  Real estate developers prefer duplex villas because they’re easier to sell due to their cost-effective prices and space-saving rooms. Villas are more expensive, but buyers get more privacy from them.

• Villas vs. Condos of the Same Size: While most have the impression that condos are cheaper than villas due to their size, it’s also important to remember that condos typically cost more to own than a villa of comparative size.

  If your condo or set of condos is the size of a small villa, those condos are costlier to own due to condo fees like monthly membership fees and special assessments that are subject to increases over time.

• Value Appreciation for Villas: Single-family vacation villas are more all-inclusive and amenity-filled compared to condominiums. Villas also cost millions of baht or hundreds of thousands of dollars that should rise along with Koh Samui’s growing popularity.

  In turn, condos are known as easy, low-maintenance properties to put your money in as a parked investment, with the idea of it appreciating in value in years without you needing to live in them.

• The Annual Costs Involved: The appreciation of value you can get from investing in a condo or villa is often negated by the annual costs. Fully furnished villas require more maintenance when compared to their smaller, sparser condo counterparts.

  Then again, villas don’t require condo fees. The extra money you have to pay to maintain a large villa is made up for its high resale value, location, and lack of fees.

• Buyers are Likelier to Pay More for Villas: Villas tend to appreciate more than condominiums because buyers are likelier to pay a higher sales price for a property without condo fees. A standalone villa with its privacy and sea views can fetch handsome prices.

  Buyers may also prefer the shared walls of a duplex villa setting compared to the room-like accommodations of condominium living and its shared amenities.

• Home Improvement Potential and Privacy: Some buyers might opt for standalone villas over duplex villas and condominiums because they value privacy and exclusivity of amenities and services over price.

  They’d rather invest their money into home improvements than shared amenity fees. The obvious downside here is that exclusive pool, parking, and garden use means you’ll also shoulder the cost of maintaining them all.

• Rent Limitations: You can buy a condo and then rent it out to someone else while still having it in your name. Or you can undergo a rent-to-own scheme where the buyer pays rent to gradually get ownership of the property in your name.

  With that said, you can also rent out your villa to others with fewer rent limitations compared to condos where you still have to pay for the condo fee unless the unit is transferred to their name.

• Tenants Can Do Villa Maintenance for You: Instead of leaving your villa empty with a caretaker or groundskeeper maintaining it clean, you can instead rent out the villa to tenants who’ll maintain the space for you.

  They’ll happily pay for rent while doing things like mowing the lawn or taking out the trash for themselves. They’ll also keep you informed if your amenities are in working order.

The risk here is that they can also end up breaking some of your furniture and appliances.

Villas are typically found in prime locations in Koh Samui, so they’re more expensive to buy on average. They’re fully furnished seaside mansions, in essence. Buy them if you want a fully furnished home available to you ASAP.

What are Condominiums?

As a foreign investor, you can also avail yourself of condominiums or condos for sale in Koh Samui. They’re practical investments with a huge upside in value appreciation but with a bit of a downside in terms of condo fees.

• Condominiums vs. Apartments: While a condo is basically one of many units in a building you can rent or buy in your name (while following Thailand laws for foreigners buying such property), apartments are slightly different.

  Condominiums share common areas like swimming pools, gyms, or a recreational area that are all open to every resident. In contrast, apartments lack these shared common areas. When buying an apartment, you only get the apartment.

• The Impact of Law Changes on the Property Market: Thanks to the Condominium Act of 2008, foreigners can own nearly half of the total units while the rest are reserved for locals.

  Condos then became more commonplace in Koh Samui, which used to be a hub for villas and commercial properties like resorts and hotels. Condo buyers also got more legal protections from their investment, particularly foreigners.

• The Rules for Foreigners When Buying Condos: The rule for foreigners when it comes to condo sale is that as long as a building full of condos spares 51 percent of its units to locals, the rest of the units are available to non-locals.

  This is also reminiscent of the percentage of allowable foreign shareholders in a Thai limited company owned by a foreigner—it should hold a majority or 51 percent (or more) of Thai shareholders to 49 percent non-local shareholders.

• The Appreciation Potential of Condos: The main reason investors buy condos in Koh Samui and elsewhere in Thailand is because they’re an easy and low-maintenance way to save your investment in a property that should easily appreciate in value.

  Instead of putting your money in a bank with the smallest interest, you can park your money by buying a condo that’s sure to appreciate in value over the years, thus allowing you to sell it again at a substantial ROI.

• Condo Shared Areas and Homeowner Association Rules: In exchange for shared services and common areas like gymnasiums, pool halls, tennis courts, basketball courts, and swimming pools, condo owners have to pay condo fees to maintain them.

  Condos also feature Condominium Homeowner Association Rules that restrict condo owners on how they use the property, thus making it difficult to rent the unit out to others, if it’s not forbidden altogether.

• Condos Selling for Less Than Their Assessment Value: If you come across Koh Samui condos that sell less than their assessment value, grab hold of them if you could. This is a huge investment opportunity.

  This could be an opportunity for you to get a condominium asset that will appreciate more quickly after your purchase. Just keep an eye out for those huge property “steals” or bargains.

• Package Deal for Multiple Condos: If you’re a large-scale investor with millions in the bank, you might get huge returns from purchasing multiple condos at a time. Sellers might willingly drop prices on individual units for bulk buyers.

  Buying several units can result in cheaper purchases and bigger gains when you sell them off to locals. Just observe the 49 percent of total units per condominium building limitation for foreign buyers.

• Small Condo Buildings are Valuable: There are times where a building with only 3-4 condo units might have all of them available on the market simultaneously. If they’re available for sale, then buy them if you could.

  If you can buy all these units at the same time, you can end up not paying a condo fee to anyone else because you’ve become the association. You can significantly manage costs this way.

• The Affordable Condo Life: If you’re going to live inside the condo unit yourself and observe a low-maintenance lifestyle that such an ownership gives you, the additional cost of condo fees might be worth it compared to single-family homes or villas.

  If you want to have a more luxurious lifestyle with all the perks and amenities of a beachside paradise, you’ll naturally have to pay more for such a privilege. Commercial real estate or single-family homes are better nest eggs to park your money with though.

Even though condos have outside restrictions on use and fees that make buyers less likely to avail of them over apartments and villas, they can be better investments in certain circumstances.

What are Land Investments?

As for land investments, you can buy land for sale as a non-local investor through a myriad of means. Buying land for sale means you get to design the property on it any way you wish.

• What is Land for Sale? There are many different types of land available on Coconut Island, from beachfront to sea-view land as well as flat land. These plots of land on Samui Island are governed by strict zoning laws and building regulations.

  Regulations dictate the size, height, type style, and ratio of buildings you’ll be constructing on the plot of land. These laws depend on the level of the slope, the proximity to other buildings, and the height above sea level of the land.

  The government has also issued land regulations for building property in Koh Samui for the sake of preserving the island’s natural beauty.

• Foreigners Buying Land for Sale: Foreigners are outright forbidden to buy land in Thailand. As a foreign investor, you can purchase land by leasehold in 30-year increments or by starting a Thai Limited Company and having it buy the land on your behalf.

  The 30-year leasehold agreement can be extended twice, leading to a maximum of 90 years of leased usage. The property you build on the land is yours but the land itself is leased.

  Your Thai Limited Company should be owned by a majority of local Thai shareholders (about 51 percent, like with the total condo units’ rule). Expect your company to get audited every 12 months as well.

• Other Means of Foreign Property Purchases: You can get Chanote titles for villas, but with the caveat of buying only the villas and not the land on them (still requires leasehold or company purchase).

  You can also own landless properties like condominiums per the requirements of the Condominium Act of 2008. You can also co-own the land by marrying a local Thai spouse.

  However, this is risky because in the event of a divorce, the land will likely go to them as they are Thai nationals and it’s likely in their name.

• Why Buy Land Instead of Existing Property? While it’s possible to find property that matches your personal tastes and needs—such that you can even do home improvement to customize it—some homeowners want to start from scratch.

  They don’t want to buy a used or ready-made condo or villa with or without furnishings. They want to build their own single-family home or multi-story mansion on a fresh plot of land, even as a non-local investor.

• Prime Locations Also Affect Property Value: Naturally, if the piece of Koh Samui land you wish to purchase by leasehold or Thai Limited Company purchase has a sweet sea-view or is near a beach, you’ll have to pay a premium-price for it.

  You might save money on it if it’s in an underdeveloped area. Or you can buy/lease the land, anticipating it will grow in value as the area becomes more developed, leading to future gains.

• Properties are More High Maintenance: If you can buy empty plots of land, it’s doubtlessly much easier to maintain compared to large, sprawling duplex villas or commercial resorts as well as flats and houses. It’s comparatively hassle-free.

  Then again, it’s not possible to just buy a land plot then forget about it till later. There’s still a modicum of maintenance and regular surveying to be done to avoid things like trespassers or other landowners encroaching on your land.

• Taking Care of Land is Less Stressful: The beauty of undeveloped land? It’s cheaper to landscape it compared to worrying about people stealing your property. You don’t have to worry about stolen property if there’s no property to steal!

  Just watch out for neighboring landowners from encroaching onyour property by moving their fences or wallsover your land. A caretaker is usually enough to watch out for your land nest egg.

• Rental Concerns from Villas, Apartments, and Condos: While you can always rent out properties with existing villas, apartments, and condos to turn a profit or get a return from your investment, they also require loads of upkeep and expenses.

  Land in your name (by leasehold or company purchase) is more like hidden treasure with only occasional upkeep. A plot of land doesn’t require minor plumbing and wiring fixes or outright remodeling projects.

• Delinquent Tenants and Property Damage: While having a package-deal villa and land deal is tempting, maintenance can be expensive. Dealing with tenants can also be a nightmare for landlords because some of them are tough to deal with.

  There are those who always complain. There are others who are late with their rent. Some might even leave your villa or condo as a mess without paying for rent or the utilities, thus you’re left with their deposit and the water/electricity bills.

Even if you decide to not build a house or building on the land, it’s an investment that can just sit there, like a nest egg with appreciating value, until you find a buyer for the land’s leasehold agreement or Chanote title deed.

In Conclusion

Investors have villas, condominiums, and land for sale to choose from when buying Koh Samui property. Choose which one to purchase in accordance with your needs. Villas are livable mansions with pools you can rent out to others or serve as your vacation home.

Condominiums are also popular among foreigners because they can be bought without you needing to own land (and foreigners are not allowed to purchase land in Thailand anyway).

Then again, you can buy land for a 30-year leasehold or with a limited Thai company (with a majority of its shareholders Thai citizens) buying the land on your behalf if you wish to build your own property through that method.

Now that you’re aware of your various property options as a Koh Samui real estate buyer, it’s now time to find the home or land of your dreams on Coconut Island!

Start your search today by looking through Conrad Properties’ Koh Samui real estate for sale in Thailand!