In the current situation if you were a landlord would you rather take a reduced rent or have your property empty?

I know of a few places where I live and the landlord would not reduce or give a grace period on the rent, 

The tenants had no option but to move out, them properties still remain empty 

One place was a small resort I drove by there the other day the jungle has taken over, the landlord has not maintained it and has a for rent sign outside.

Assuming that i owned a number of properties,i would close the majority down and weather the storm.Then i would concentrate on just a select few in the busier places.What i certainly would not do is leave them to get rundown etc.That to me means problems, i.e Financial,Monkey house ,or even Death / Ghosts !

But Hey......Thats just me. ????

I would take the reduced rent (albeit on the understanding that it would go back to normal when things went back to normal). 

 

Slightly off topic, but along the same theme... a mate of mine was paying 35K pm for his Condo but kept having problems with the floor tiles lifting up so he asked the landlord to fix them once & for all + a couple of other minor irritations when he was coming up to his (2nd) renewal... The landlord refused so he moved out & into an identical unit (better furnished) for 30K pm... 18 months later the lady who works on the front desk hands me my spare keys, apparently he'd left them in the unit thinking they belong to it (swore blind that I'd never given them to him) & they'd been found, presumably when new tenants had moved in (though could have been the owner had gone in to clean it up to sell as it seems to be for sale now).

 

If it was new tenants, then I'm betting the owner would have had to accept 25K (maybe less) as this was only 3-4 months ago whereas my mate was happy to renew for 35K if the landlord would have fixed the few relatively minor niggles & would have continued to do the same as he was happy there... He's even happier now ????     

 

13 minutes ago, Mike Teavee said:

I would take the reduced rent (albeit on the understanding that it would go back to normal when things went back to normal). 

 

Slightly off topic, but along the same theme... a mate of mine was paying 35K pm for his Condo but kept having problems with the floor tiles lifting up so he asked the landlord to fix them once & for all + a couple of other minor irritations when he was coming up to his (2nd) renewal... The landlord refused so he moved out & into an identical unit (better furnished) for 30K pm... 18 months later the lady who works on the front desk hands me my spare keys, apparently he'd left them in the unit thinking they belong to it (swore blind that I'd never given them to him) & they'd been found, presumably when new tenants had moved in (though could have been the owner had gone in to clean it up to sell as it seems to be for sale now).

 

If it was new tenants, then I'm betting the owner would have had to accept 25K (maybe less) as this was only 3-4 months ago whereas my mate was happy to renew for 35K if the landlord would have fixed the few relatively minor niggles & would have continued to do the same as he was happy there... He's even happier now ????     

 

Thai's dont like to maintain things, That cost money

18 minutes ago, KC 71 said:

Assuming that i owned a number of properties,i would close the majority down and weather the storm.Then i would concentrate on just a select few in the busier places.What i certainly would not do is leave them to get rundown etc.That to me means problems, i.e Financial,Monkey house ,or even Death / Ghosts !

But Hey......Thats just me. ????

All of our properties are empty at the moment but we still go and clean them, I even changed the light bulbs the other day always looks better if someone comes to look

I am a landlord and as some tenets moved out in the last year, I have reduced the rent to keep in line with the current market. 80% of the normal rent per month is better than 0% in my book, but everyone is different. 

Contract ended at the end of October in an area where a lot is empty now. The new one moved in on Nov 12, 1000 baht cheaper but better than nothing.

The guy next door to me refused to drop his rent by 5,000 baht per month to the occupants who had been there for more than a year they moved 8 doors away for much less leaving the guy next door now in his 5th month of no customers they were paying 30,000 baht per month they tell me they now only pay 20,000 for a bigger place 

I've been a landlord. Good and bad tenants. Assuming I was a landlord in Thailand, I'd be trying to sell whatever property I had so it could be someone else's problem.

I'd agree with the concept that some rent is better than nothing.

According to my Thai wife some landlords don't want at all to discuss about a price.

 

They fix a price, one accept it or not.

 

Some even consider it as an insult for trying to bargain.

I've seen places sit empty for years because a stubborn owner is holding out for a specific price which nobody will ever pay.

Landlords will do better financially if you keep the properties rented even at a lower price.  IMHO

11 minutes ago, ukrules said:

I've seen places sit empty for years because a stubborn owner is holding out for a specific price which nobody will ever pay.

That's a good way to lose income.

13 minutes ago, how241 said:

That's a good way to lose income.

Yes, not only that, he increased the rent from 25k a months to 35k a month even though it had sat empty for a year at the time.

 

The previous tenant had requested a rent reduction from 25k to 20k which was refused, that's when the madness started.

 

I find it hilarious, now COVID's here it's worthless

You've got to lower rent if asked, if I was renting now I'd be looking for better deals, rents are dropping fast the last few weeks

35 minutes ago, ukrules said:

I've seen places sit empty for years because a stubborn owner is holding out for a specific price which nobody will ever pay.

Every year they put the rent up

1 hour ago, Lacessit said:

I've been a landlord. Good and bad tenants. Assuming I was a landlord in Thailand, I'd be trying to sell whatever property I had so it could be someone else's problem.

I'd agree with the concept that some rent is better than nothing.

Not easy to sell at the moment

I know of a landlord who has a row of shops 6 in total all full paying rent until lockdown I know from one of the tenants he would not do a deal, 5 of them shops are empty and have been for a while

48 minutes ago, ChipButty said:

Not easy to sell at the moment

True enough, I have a friend in CM who was trying to sell a property for five years, only closed the deal a couple of months ago.

Its much more prudent to shut down the Rentals rather than reduce Rents.

Reduced Rents will only give more wear and Tear to the Properties which require repairing 

 

I am a landlord and its a case of charge what the market will bare. Some of our long term tenants have asked to have the rents reduced, so its been a case of negotiate. Better something than nothing. 

Actually and to be fare Thailand for the large extant, has  escaped the brunt of the Covid mayhem and people staying home and not working and the damage to real industry is miniscule in comparison to other countries so for for tennant to use this excuse to ask for a lower rent is unfair... unless the said tennant is genuinely suffering a hardship...

A row of townhouses next to me are sitting empty. 

 

But they've sat empty since they were built 5 years ago. 

 

Only up for sale at an overpriced amount, not for rent.

 

 

So, 5 years of earning 0 on a 20 million baht investment. 

20,000 baht unit - 6 months empty out of the year. Lose 120,000 baht in potential revenue

Same unit, reduce the price by 5k, get a tenant today. Lose 60,000 baht in potential revenue.

 

I think holding out for more than a month or two just means a landlord isn't being realistic about the market value of the property.

 

 

 

28 minutes ago, ezzra said:

Actually and to be fare Thailand for the large extant, has  escaped the brunt of the Covid mayhem and people staying home and not working and the damage to real industry is miniscule in comparison to other countries so for for tennant to use this excuse to ask for a lower rent is unfair... unless the said tennant is genuinely suffering a hardship...

 

That argument kind of falls apart when it comes time to renew the contract and the tenant knows there's a much better apartment available in the same building for the same price as the current unit....

 

Or even worse, an identical unit for considerably less.

 

I reduced my place and a month or so after noted all the others looking to rent kept their prices same for few months . Only then did they start reducing and reducing the price and still most are empty , some are at 60% of usual rate but still not rented .

I know a few Thai people who rent out places and they won’t reduce the price no matter what ! They rather it sits empty than them lose 2000bht a month on a 25,000 a month rental . Logic isn’t their forte ! 

27 minutes ago, JeffersLos said:

A row of townhouses next to me are sitting empty. 

 

But they've sat empty since they were built 5 years ago. 

 

Only up for sale at an overpriced amount, not for rent.

 

 

So, 5 years of earning 0 on a 20 million baht investment. 

Seems top be the "Thai way" I'm afraid!

On 11/24/2020 at 8:29 AM, ChipButty said:

In the current situation if you were a landlord would you rather take a reduced rent or have your property empty?

 

On 11/24/2020 at 9:21 AM, ChipButty said:

All of our properties are empty at the moment but we still go and clean them, I even changed the light bulbs the other day always looks better if someone comes to look

??

 

So, you ask "if I were a landlord" then you say you have empty properties so one can assume you are in fact a landlord?

You asked the question so are your properties empty because you were not willing to reduce the rent?

1,2,3 million b or whatever dead money properties sitting, paying maintenance fees generating nothing.  All seems like a very poor business model for a investor/landlord.

Any landlord with common business sense would rent out his properties even at a reasonable discount in the current environment, not let them sit empty..

 

 

Guess not. Here we have shops, all empty, standing idle. Bigger shops moved to smaller locations or combine with other shops to reduce costs. Meaning price is too high, and no reductions by "landlord". It looks better to have them empty.

In China they made complete ghost cities, no one goes there, too expensive. See youtube.

There are more of those places. 

In Phillipines you have a big mall with tourist like area, not working. Just about 5 shops and all other shops closed, empty.

GUess those shops will be closed now as  well.

Looks like they choose better empty then some money anyhow. So also with houses?

Having been a managing agent in a past life there is a thing called the market. Have been through all of the landlords that would not reduce their rent  when things turned bad. If you have an investment the number one priority is cash flow. No cash flow, no profit.

But then you look at the other side of the coin, especially for commercial property where "value" is a multiplier of the net income. Reduce the rent, reduce the value. But that is for the professionals to worry about.

With residential property value is not so much tied to return, so many other factors come into it. So if you have an investment it all comes back to cash flow, as you have no control over the value to a buyer and it is he who determines how much cash you receive if you need to sell.