Beat up properties In Pattaya?

[chicowoodduck]

Oh my Buddha, the main reason I still have baht in the bank and live the good life here in LOS is that I NEVER, EVER listen to all the so called experts on Thaivisa....in fact I usually do the complete opposite.....lol.....

 

FYI.....the same ones who offer advice on money are the same ones who are also offering free medical advice.....geez, get a grip.....??????

[trogers]

34 minutes ago, catman20 said:

are you serious ? have you looked in Siracha ? i have its over built there also many many units unsold and many empty. Korn Kaen ? did you mean khon kaen? 

What are the asking prices in those overbuilt? Any old condos, at 30% of those new prices that you can rent out at 60% of their asking rent?

 

Khon Kaen, yes.

[newnative]

8 hours ago, Khun Jean said:

Well you must have gathered your knowledge from the internet.

Sure everyone likes to buy new, only the prices do not allow that.

The middle class buys what they can afford. They are also getting fed up with renting. Especially because owners really do not do anything to keep up a condo. And the ones who rent have a real hard time to spend money on something they don't own.

Credit is pretty easy for ones who have a good job. And smarter ones buy a 40m2 older condo for under 1MB instead of a new 20m2 for 2Mb.

How do i know? I have only been doing this for about 15 years.

I compete with Thai buyers as i buy only to rent out. I am not in the buy and flip game at all.

Many times a good deal is snapped away right before i had a change.

Last month i missed out on four of them (planned on buying one), all in the same building as the owner decided to cash out. I thought i could at least get one, but alas i heard in ONE day too late.

 

Just to clarify, I do my business in Bangkok and rent out only to Thais with good jobs. No shortage of them and close to 100% occupancy tells me i am on the right track.

 

        Good post and I agree with what you said.  My Thai partner's Bangkok relatives are doing the same thing as you--buying properties only to rent out and not to flip. Most are condos and I think there are 1 or 2 shophouses.   They will not have a pension from their jobs, just a one-time cash payout, and these rental properties will provide income during their retirement. 

      Thais have the 'home field advantage' when it comes to buying properties.  They are likely to have better knowledge than a farang on builder reputations/track records, good vs. bad neighborhoods, building popularity, what city areas are hot and what areas aren't popular, management companies, building histories, projects proposed and in the pipeline, grapevine information, and future things like retail, metro lines, and so on. 

      I think it's pointless to argue back and forth on whether Thais prefer new and shun old.  The right answer would be 'It depends'.  Old or new is just one item in many factors considered.  An older condo with an excellent track record on rentals in a well-maintained building might be more desirable than a new condo with no rental history.  Getting back to my Bangkok relatives, with the rentals funding a chunk of their retirements, you can bet that they carefully weigh everything before buying and will try to make the wisest choice after gathering as much information as they can.  It's unlikely any of them would make an impulse condo purchase from a former bar girl or farang hawking condos from a booth at Central Festival.  

[Destiny1990]

1 hour ago, trogers said:

What are the asking prices in those overbuilt? Any old condos, at 30% of those new prices that you can rent out at 60% of their asking rent?

 

Khon Kaen, yes.

Yes but soon as those newer ones start drastically to lower their rent prices then tenants will favor the new units.. yes u will say u can also lower the rental price?

[Destiny1990]

9 hours ago, Khun Jean said:

If new is first choice and second hand is third choice what is second choice then?

 

That statement  is a metaphor.

[trogers]

14 minutes ago, Destiny1990 said:

Yes but soon as those newer ones start drastically to lower their rent prices then tenants will favor the new units.. yes u will say u can also lower the rental price?

New projects, 80% of units are studios and 1-bed or 20-30+ sqm, and 2-bed of 50-60 sqm.

 

You go for 80-100 sqm 2-bed to differentiate your product.

 

How low can their rents get while facing mortgage financing and higher common fees?

[Destiny1990]

12 minutes ago, trogers said:

New projects, 80% of units are studios and 1-bed or 20-30+ sqm, and 2-bed of 50-60 sqm.

 

You go for 80-100 sqm 2-bed to differentiate your product.

 

How low can their rents get while facing mortgage financing and higher common fees?

U are so correct ??..

[Khun Jean]

Older units are often bigger, no need to be afraid newer condos will ever have better rental prices. A swimming pool is often just an add on that is barely used. And a huge cost. Parking, close proximity to public transport is more important.

As i said before, i only rent out to Thai people with decent jobs. Foreigners stay short and require more work, and most of them are looking for something bigger with a swimming pool. Foreign English teachers is a prime category that will be refused. Low salary, no correct visa etc. Learned my lesson pretty quick.

 

I prefer older buildings with good management. The ones who enforce the 'no shoes in front of the door' rule are often good. :) :) 

To find those you need to have patience and more patience.

My retirement will be from rental properties. If it does not come close to 10% ROI after refurbishment then i am not interested. New condo's get maybe 5%, it just does not work for rental income. Sure it is nice to show off with and have big face, but your wallet will shrink.

 

I keep my eyes and ears open as much as possible. I have two Thai family members who saw what i did and converted their land into condo's as it is a much better deal and better way of securing some income at old age.

Together we have condo's in about seven different buildings and have good relations with the condos management.

 

Small problems (electric,water,drainage) are solved by them for a small amount. Renters don't have to wait for me, it is fixed within a very short time.

 

Refurbishment is in its most basic form some new paint, but often a new tile floor. Bathrooms are in my farang eyes often dirty with leaking grout. New grouting, waterproofing or a complete new tile job is often necessary. Some basic furniture, new inverter airconditioner and it is ready to be rented out. I keep refurbishment around 50.000 for a 30m2 condo to about 100.000 for the larger ones.

 

This will make a big difference with other condos that are for rent, which are often still in the original state. There is no comparison and with slightly higher prices guess who rents out and who stays empty longer. We even have a waiting list!! from people in those buildings who would like to move from their 'old' one to our 'new' ones.

 

Sometimes those 'old' ones become available to buy as the owner does not want to go through the trouble of finding a new tenant (and especially not refurbishment) and just cashes out with a good profit.

This strategy started to work good after almost 10 years. Having condo's in multiple buildings makes finding new ones in those buildings easier. As we already know management is good and the basic structure is solid we can offer money without seeing the specific unit. Only this enables us to be sometimes quicker then Thais.

 

I have talked to foreign owners of newer and higher quality condos often. The problems renting out (15.000 or higher per month) is real as so much is for rent with similar quality and prices. I choose to target Thais (4000-10000 per month) as they are the majority in this country and the choices (good quality) they have are limited. :) :)

 

Edited December 9, 2017 by Khun Jean

[huawei]

Good management is under estimated by many..it is rare here..it is vital..yet ignored by many when looking at a purchase, another plus for an established building..

[NoBrainer]

23 hours ago, alex8912 said:

Again one of the biggest Thai Visa Forum myths. I'm sure that's why you have not sold a condo in Thailand to a Thai. The last condo I sold for a very nice profit was in a 20+ year old building to, ok, HOLD ON a single female Thai professional!!!  She was very happy to buy and move into my nice condo off Satorn with an amazing view of the tallest building in Thailand and downtown. The building is as solid as a rock ( I never ever heard the people below, above or next to me when I lived in it myself) and well maintained.  For 8 years of reading TVF posters with no real life experience always say Thais only buy new.  My neighbor sold his to a Thai and he told me his neighbor sold to a Thai before me as well.  Thais will buy nice older condos and they without a doubt like a great location. 

 

Well the OP was asking about homes, not condos, I was only throwing condos in to the conversation to demonstrate how bad the market is here.

 

I've lived in the area for many years, and did quite well with off plan condos from 2008 to 2011, but after that the market went soft, and eventually became nonexistent due to the massive oversupply.

 

 

[trogers]

34 minutes ago, NoBrainer said:

 

Well the OP was asking about homes, not condos, I was only throwing condos in to the conversation to demonstrate how bad the market is here.

 

I've lived in the area for many years, and did quite well with off plan condos from 2008 to 2011, but after that the market went soft, and eventually became nonexistent due to the massive oversupply.

 

 

Wait out another couple of years, when the teaser rates of mortgages end. These owners will have to come out of their pockets Bt20-30k a month to cover mortgage and common fees payments.

 

Quite a few would default.

Edited December 9, 2017 by trogers

[baansgr]

Taxes of buy and sell play a huge part.