Buying condos for investment?

[aMike]

Wondering if anyone has experience with buying condos in chiang mai for investment, and  renovating to rent out. 

 

What was your experience like? Any tips are welcome

[worgeordie]

Unless you could find a cheap Condo in a  good area*,you

would not get a decent return on your investment,with a glut of Condos,

and more been built everyday,rents are depressed,but for whatever 

reason, prices of Condos are high,renting out property is not just

about collecting rents,it can be a lot of headaches,especially if

you get a bad tenant.         *virtually impossible.

 

regards worgeordie

 

[Peterw42]

A few variables to consider, what rental would you be doing. Short term tourist rental (1-2 months), great returns but variable demand/occupancy. Long term expat rentals, good returns, lots of competitors etc. Long term rental to Thai people, lower returns, steady demand, long term etc.

 

You can buy an overpriced condo in an oversupplied area, drop the price to get a tenant and end up with a return less than bank interest. Alternative, you can find something for a good price, lots of rental demand etc (or identify/create your own demand) and get 10% net return.

 

I know its not Chiang Mai but I have a friend in Pattaya who owns 9 Condos and averages an 8% net return. Exclusivity long term Expat rental. He buys for a good price, a certain level of fit out, reasonable rent etc. Contactable 24hrs a day.

 

Although there are many other Condos for rent etc, He get the expats who want easy, English contact, English documents, and are willing to pay more for the convenience.

 

I also look at my next door neighbour, he hasn't had a tennant in 2 years, stupid high price, Thai agent who doesnt even answer the phone etc etc. Everytime I see him he is moaning about the bad investment he made.

 

 

Edited January 12, 2018 by Peterw42

[aMike]

5 hours ago, worgeordie said:

Unless you could find a cheap Condo in a  good area*,you

would not get a decent return on your investment,with a glut of Condos,

and more been built everyday,rents are depressed,but for whatever 

reason, prices of Condos are high,renting out property is not just

about collecting rents,it can be a lot of headaches,especially if

you get a bad tenant.         *virtually impossible.

 

regards worgeordie

 

what would you consider cheap for a small condo? Like 30-35 meters as most older ones are. I'm only looking in nimman.

That's what real estate agents are for, to avoid the headache of dealing with tenants :)

[toughlove]

what would you consider cheap for a small condo? Like 30-35 meters as most older ones are. I'm only looking in nimman.
That's what real estate agents are for, to avoid the headache of dealing with tenants :)

Location location.

Cheap Condos are never in a good location.

[aMike]

5 hours ago, Peterw42 said:

A few variables to consider, what rental would you be doing. Short term tourist rental (1-2 months), great returns but variable demand/occupancy. Long term expat rentals, good returns, lots of competitors etc. Long term rental to Thai people, lower returns, steady demand, long term etc.

 

 

 

Planning to do shorter term rents for months, maybe even weeks, via an agent in Nimman , as it's a high demand area. 10% would be pretty good!

I'm curious if anyone has some tips regarding renovations in old buildings. Any things that are different here, to keep an eye on..?

 

 

[Dante99]

22 minutes ago, aMike said:

Any things that are different here, to keep an eye on..?

 

 

Everything is different here and you need to keep an eye on everything you care about.

[worgeordie]

1 hour ago, aMike said:

what would you consider cheap for a small condo? Like 30-35 meters as most older ones are. I'm only looking in nimman.

That's what real estate agents are for, to avoid the headache of dealing with tenants :)

You are not going to find any cheap Condos around  Nimmanhaemin Road,its one of the most

popular places in Chiang Mai for tourists,and Real estate agents do not solve all your problems,

they are not professional like they maybe in the West,you need to be active in all aspects of 

maintaining,renting,your property, you keep saying Cheap, what kind of price are you expecting

to pay for a unit.?     then you have to find a property where all the foreign allocation is not already

sold.

regards worgeordie

[marcofrenchpolo]

Hi aMike, PM me if you looking foor big condo in ninamm, best regard marco

[CheGuava]

2 hours ago, toughlove said:

Location location.

Cheap Condos are never in a good location.

 

That's not actually true.   And the other way around is definitely not true, that expensive condominiums are reliably in a good location..

 

(Unless you mean the absolute lowest of the low:  shitty building AND in a shitty location.. )

 

Edited January 12, 2018 by CheGuava

[toughlove]

 
That's not actually true.   And the other way around is definitely not true, that expensive condominiums are reliably in a good location..
 
 

Huh? Pick the most desirable area in the best location and the condos are cheap?

Good luck with that

[canthai55]

2 hours ago, aMike said:

That's what real estate agents are for, to avoid the headache of dealing with tenants :)

Wow - I would do some investigation - lots and lots - before I used one of these for the day to day operation of my investment. Agents are in business for themselves, not you, especially here. Do SFA and charge you. But UP2U

[CheGuava]

14 minutes ago, toughlove said:

Huh? Pick the most desirable area in the best location and the condos are cheap?

Good luck with that

 

No, I mean that you can find a cheap condo  (older building) that is however in a much better location than a very fancy and expensive one, that for some reason has been built WAY up the canal road instead of in town where I want it to be.

 

 

Edited January 12, 2018 by CheGuava

[canthai55]

Buy a nice condo - talking 5 million plus - in a prime location - and it will be a lot better investment than a 25-30-40 sq M box in a big box full of these smaller boxes.

 

[CheGuava]

8 minutes ago, canthai55 said:

Buy a nice condo - talking 5 million plus - in a prime location - and it will be a lot better investment than a 25-30-40 sq M box in a big box full of these smaller boxes.

 

Yes.. or two or three adjacent small ones and renovate nicely, in an average building that is however in an excellent location.

 

over 5 million though.. is a little high for Thailand / Chiang Mai..  Not really a problem if you live there yourself and it's a nice place, but on the topic of 'investment' I'm not sure it's a great deal, compared to other things you might invest in.

 

Edited January 12, 2018 by CheGuava

[heybruce]

2 hours ago, CheGuava said:

 

Yes.. or two or three adjacent small ones and renovate nicely, in an average building that is however in an excellent location.

 

over 5 million though.. is a little high for Thailand / Chiang Mai..  Not really a problem if you live there yourself and it's a nice place, but on the topic of 'investment' I'm not sure it's a great deal, compared to other things you might invest in.

 

Finding a cheap condo for renovation in a building that is not also in need of major renovation, and possibly new management, can be a challenge.

[LivinLOS]

As someone who really dislikes collectivization and a lack of control, the fear of long term maintenance is too large to make me consider it.. 

 

Even if a condo is doing well for 5 years.. Predicting which ones will be well managed and kept up at 10 and 15 years out is beyond me. My first home in Chiang mai was my first moobaan home, the sinking fund had been exhausted, the services cut off, the houses starting to crumble, security went from good to a joke, the communal space rented to a 3rd party.. 

[Ricardo]

My wife bought a 36-sq-m bargain-condo for B600k just outside the Super-Highway near Makro, she did a good rennovation (she has an eye for design/colour-schemes), and has been unable to sell it for three years, because viewers (all Thai) are put off by the poor-condition of the lifts (under-lit & dirty) & public-areas (poorly-decorated & cleaned), the building's managers could care less about these things.

 

So look at the management & public-areas, tryto view them as potential renters would do, would you yourself want to live there ?  Are the neighbours noisy, does the place smell, is it cleaned/maintained/decorated properly or not ?

[chingmai331]

Ricardo, please.  Wife's solution is simple; keep dropping the price until her tears stop flowing.  It will happen, someone will buy it and wifey's troubles will be over and she will have learned a lesson.

Many good decades of life have taught me that all education costs something: money, time, energy and often, dedication and persistence. 

 

If she can keep the place unsold and unrented for 3+ yrs, you guys have no income problems, therefore get little sympathy.

[Ricardo]

7 minutes ago, chingmai331 said:

Ricardo, please.  Wife's solution is simple; keep dropping the price until her tears stop flowing.  It will happen, someone will buy it and wifey's troubles will be over and she will have learned a lesson.

Many good decades of life have taught me that all education costs something: money, time, energy and often, dedication and persistence. 

 

If she can keep the place unsold and unrented for 3+ yrs, you guys have no income problems, therefore get little sympathy.

 

I was trying to give some good-advice to the OP, but whatever, I certainly don't need (nor did I ask for) your sympathy.

 

Jeez, some days I really understand, why so many people stop posting on TV.

 

 

[cardinalblue]

Buying land is a better investment than rental property  in CM province....

[Dazinoz]

I was looking at buying one when I first moved here about 4 1/2 years ago. My real estate agent told me not to unless I wanted to live in it as there were so many being built in CM that there will be an over supply and thus lower returns.

 

Having said that I was stupid enough to buy a Fractional ownership of a unit in a great complex in Patong Beach Phuket. Turns out a BIG waste money and I would have been better off buying a couple of condos for the money I out layed.

[1FinickyOne]

I think it is more of a job than you might imagine. Agents often are great until you need something. This is not a passive investment. It can be ok or a nightmare. Good luck.

[LivinLOS]

57 minutes ago, cardinalblue said:

Buying land is a better investment than rental property  in CM province....

It is until it isnt.. 

 

Those who dont remember 1997 and a 75% wipe out of values would do well to relearn it. I am not suggesting a revaluation that harsh, but I have seen an illogical spiralling of values around where we purchased, its now +- 400% more in 5 or so years, and every other plot in the village has a for sale sign up. 

 

Free money and global ZIRP cannot continue forever.. The crunch will have to come. My wife often trots out the 'land never go down' oh yeah ???

[evenstevens]

58 minutes ago, kenk24 said:

. Agents often are great until you need something.

Or in my view

they always  looking  for  good commission fee without doing  any leg work etc etc , from my experience steer clear of any Farung  orientated  Agency,s

have found Thai Agency,s or a  Private Sale far more easier to  deal   with  and reach common ground,   between both parties , then a Farung involved Agency,s   good luck to the O/P

[BernieOnTour]

IMHO your idea is good - however, you are a few years too late !

 

Others have done it before successfully, but now the prices have risen to unacceptable heights, so it doesn't work out anymore. Otherwise, I would do it myself :-)

 

The Nimman property market is heated up to an unhealthy level, not at least by Chinese demand, which is driving up prices even in those properties not directly fancied by them. In those condo buildings(eg. Sky Breeze), which were prone to that business model, owners have replaced condo management and J.O., upgraded the infrastructure and either done the renovation by themselves or long sold off. 

 

Also, I wouldn't underestimate the "farang price uplift" with Thai builders, if you do not speak Thai...

 

Edited January 15, 2018 by BernieOnTour

[sawadee1947]

well, next to Holiday Inn many condos are on sale 3-5 Million up, unrenovated. Put 2 Million for renovation. At the end you'll get maybe 30 Tsd7month. And don't forget maintenance of 14 Tsd/year. Do your mathematics.

Buy land.

[worgeordie]

2 hours ago, LivinLOS said:

It is until it isnt.. 

 

Those who dont remember 1997 and a 75% wipe out of values would do well to relearn it. I am not suggesting a revaluation that harsh, but I have seen an illogical spiralling of values around where we purchased, its now +- 400% more in 5 or so years, and every other plot in the village has a for sale sign up. 

 

Free money and global ZIRP cannot continue forever.. The crunch will have to come. My wife often trots out the 'land never go down' oh yeah ???

Your wife's right,.....again

regards worgeordie

[tryasimight]

On 12/01/2018 at 2:33 PM, aMike said:

Planning to do shorter term rents for months, maybe even weeks, via an agent in Nimman , as it's a high demand area. 10% would be pretty good!

I'm curious if anyone has some tips regarding renovations in old buildings. Any things that are different here, to keep an eye on..?

 

 

Less than 30 day rentals may be problematic for you

[LivinLOS]

40 minutes ago, worgeordie said:

Your wife's right,.....again

regards worgeordie

So how can that be factual given 97 - 99 ?? 

 

75% loss.. Phuket took a decade to recover the same values..