AN EERILY quiet nine months in Phuket?s property industry has been the result of a ?Mexican standoff? for most of 2009 in Phuket. While sellers reduced prices back to a long-term ?fair valuation? ? a reduction of around 30% from the peak highs ? flush buyers have been seeking distress pricing and a further 30% discount!

The result was virtually no transactions.

Tough lending requirements ? virtually zero financing, in fact ? meant owners saw little need to panic and lose a prime asset at a time of low liquidity. Tourism is off some 20% over 2008 but there has been a steady slew of renters and we know of one six-bedroom villa that has maintained 85% occupancy all year at US$800-4,000 a night, so it?s not all bad.

Phuket was fortunate in that the market, as an all cash one, is made up principally of end users and an increasing number of permanent residents escaping big cities. Global entrepreneurs and retirees continue to choose Phuket over other destinations as their Asian base. There have always been very few banker type buyers, as their vacation times are too precious, so the meltdown of investment banks and their workforce/bonuses have had little impact.

As we enter the fourth quarter, there has been a marked thawing in the frost and intransigent negotiations that have frustrated all parties throughout 2009 are now going through. With bullish regional equity rebounds, a relaxation in global business nervousness and a back to R&R mentality, well-healed buyers have started writing cheques again.

Developers, despite not being able to reduce prices dramatically, are being realistic, sellers of luxury homes are getting fair value prices, leaving buyers with a great long-term asset and yield possibility. Competition of services continues to be the buzzword from buyers, with rental programs, solid property management and access to boats and beach clubs all being offered.

Today?s buyer is savvy, seeks value, is well informed on the range of property and is looking for representation from an agent who represents quality developers with the experience and balance sheets to match their bravado. They require an agent prepared to do battle on their behalf.

Agencies that list all properties at the highest possible price and are not tough on ensuring that the stories told are the same as the plans being built will lose customers trust and find the Mexican standoff continuing into 2010.

Developers who have shown financial strength this year and have made solid construction progress will be signing deals this quarter and we may well find that, by end of Q1 2010, the luxury market moves to an under supply of new quality developments.

I recommend buyers take advantage of this fluidity to lock in deals and negotiate payment terms and interior packages. The global financial crisis has been the background of Phuket?s musical chairs in 2009? as that song comes to an end in 2010 buyers will have to move quickly to make sure they are not left standing, or in this case, without a long-term value-priced roof over their head.

Any fool can buy expensive real estate (with a good bank manager); the smart money is well advised and is backing Phuket.

Nick Anthony is managing partner of Indigo Real Estate ? voted agency of the year at the Thai Property Awards in 2008. Visit their site at www.indigoRE.com or email nick@indigoRE.com