An English accountant from Guilford, wrote to ask "Why there was such a difference in value between prime and non prime land in Phuket"?

There is of course a glib and often repeated answer to that question, employing three repeated words, usually attributed to Conrad Hilton. I will try to answer your question without repeating them.

It's going to be tough.

If Hilton is out, lets try Keynes, the first proponent of the market driven economy and theories of supply and demand.

Land is clearly a commodity in fixed supply globally - and on a small island like Phuket that supply is even more limited. Phuket is certainly also very much in demand - visitors and increasingly foreign residents and retirees are coming here in ever increasing numbers. While some of those visitors are venturing out into neighboring provinces such as Krabi and Phang Nga the majority stay in Phuket. So it's clear we have fixed supply and increasing demand - the recipe, according the Keynes for rising prices.

That however does not answer the question as to why some areas of Phuket see much higher values than others. The answer must be that while land in it's very basic sense is just a unit of space for production, there are clearly attributes that differentiate some land from other land. Let me create a trilogy of my own which I shall call "Proximity", "Branding" and "Aesthetics" to try to explain that differentiation.

"Proximity" - Being close to sources of demand (be they passing trade, buyers, neighbors), or being accessible to sources of supply or transportation (shops, restaurants, busses, airports) are attributes of land that have a clear and relatively quantifiable economic value. Which attribute will be of value to which buyer / owner will of course vary with the individual and the type of land use envisaged.

"Branding" - While land can be sold as a raw product, at the residential level it is more usually sold as part of a package with other value added services (roads, utilities, recreation facilities) as part of a development. Land developers, just like other manufacturers, want to differentiate their product and typically work to create the impression of a superior product and services.