Phuket's tourism sector is rebounding as Middle East conflict impacts ease and international flights resume, particularly from China, Australia, and the Middle East. However, hotels face headwinds: oversupply from illegal properties, reluctance to raise rates amid consumer spending constraints, and competitive pressure limiting pricing power. Room rate growth expected to remain modest (~5% YoY) despite strong long-haul demand, with operators pivoting to value-add services and packages to attract customers.