Buying condo's to rent out

[georgegeorgia]

Lately  have this fetish to think about buying Condo's to rent out so I can get income to live in Pattaya 

 

I will have to withdraw the money from my retirement account though , but...I'm thinking I will have income coming in..

 

But then I'm thinking if I spend say 600,000 baht on a condo in the Nirun and it gets 4,500 baht a month rent ( if I can find a tenant) then after expenses it's going to take over 10 years to get the capital back.

 

I don't know ,is it worth the risk ?

Say I have 10 million baht in my retirement funds and I buy all these condo's and have only rent coming in  and no monthly retirement income from the savings account as I spend it all on condo's .

 

I do think low class condo's would be better to rent out , I don't like the Nirun ,last time I was there to look  it was 9am and shirtless farangs were just standing by doorways holding bottles of beer ,as I walked past one ,he lifted his beer up & he shouted out "bunny wabbit !!! Bunny Wabbit! 

 

So I kept walking 

[redwood1]

So did you take you shirt off too and have a beer with him?

[OneMoreFarang]

If you spent a few minutes on this form it should be easy to find a couple of threads about the same question.

The answer is always the same: NO! 

[HappyExpat57]

If you have to pull your money out of your retirement fund to finance this gamble then you are not fluid enough to absorb possible loss. In most normal rentals, you have to anticipate at least a 10% vacancy rate. I can only imagine in LOS that rate is much higher. Then you have the upkeep/maintenance and repairs which can really hit you in the wallet.

 

Since you're asking, I'm replying - I don't think you're in a good place to try this adventure.

[champers]

Have you got big ears?

[jacko45k]

I have a pal who has just got into this, but he is the always active and busy type and I think he enjoyed renovating work.. despite the frustration of working with the locals. 

Not sure of your choice wrt Nirun, remember the doctrine, location, location and location. Look for places people want to live or buy.. they will command better rents too. 

[Peterw42]

I live off a couple of rental properties, for me its been great. I bought 2 condos for 1.2 million baht each, and get around 8k a month in rent each. Outgoings are small, condo fees 12k a year, any repairs are cheap. I get around a 7% net return, way better than any bank interest or share dividends.

I would avoid places like nirin as they may be cheap to buy, but you get cheap rent and cheap tenants.

For me its a great investment and gives me most of my income to live here. Ignore the negative comments from people who dont actually own any property, just heard stuff from a guy in a bar.

[georgegeorgia]

I'm thinking it's a income but your right about vacancy rates 

 

I'm thinking risk management less if I took on lower class places such as Nirun ...but then the income is not good .

 

So I spend say 500k-600k for 4500 baht a month rental income  minus expenses ....so maybe leave me 3500/4000b  a month coming in 

 

But then on the other side if I don't buy a investment property I'm drawing out say 50,000 baht a month out of my retirement funds with no income !

 

 

[georgegeorgia]

3 minutes ago, Peterw42 said:

I live off a couple of rental properties, for me its been great. I bought 2 condos for 1.2 million baht each, and get around 8k a month in rent each. Outgoings are small, condo fees 12k a year, any repairs are cheap. I get around a 7% net return, way better than any bank interest or share dividends.

I would avoid places like nirin as they may be cheap to buy, but you get cheap rent and cheap tenants.

For me its a great investment and gives me most of my income to live here. Ignore the negative comments from people who dont actually own any property, just heard stuff from a guy in a bar.

Do you out them in a real estate agents hands?

[Peterw42]

2 minutes ago, georgegeorgia said:

Do you out them in a real estate agents hands?

I have used an agent to find a tenant, but otherwise no.

[NickyLouie]

If anything you can film a reality show at the Nirun and it's bound to be a hit.

[Isaan sailor]

If you’re an American, buy and hold blue chip stocks with big dividends.  One example: Altria (MO) pays over 9%.  There’s always a risk the dividend will falter.  I’ve owned it 30 years.  So far, so good.

[jaideedave]

8 minutes ago, Isaan sailor said:

If you’re an American, buy and hold blue chip stocks with big dividends.  One example: Altria (MO) pays over 9%.  There’s always a risk the dividend will falter.  I’ve owned it 30 years.  So far, so good.

I call myself a dividend hound.I never made a ton of $ buying dividend stocks but never lost a penny.

I used to use the DRIP scheme to great advantage.

I'm out of the game now but in my case it was a winning formula. I'd recommend this strategy to anyone.

Even the Thai REIT "CPNRF" paid a good divy for years.

[Elkski]

Find a different fetish.  10 mil baht isnt much to retire on unless your 75. 

[Countryman]

I think ,you think too much , a 600 K condo will not be an investment 

it will be a headache ,imagine the kind of tenant you will get, looking to

pay 4K Baht , 

[georgegeorgia]

1 hour ago, Elkski said:

Find a different fetish.  10 mil baht isnt much to retire on unless your 75. 

I think if your 67 and get the old age pension too it's ok 

 

[Joebuzzz]

5 hours ago, georgegeorgia said:

Lately  have this fetish to think about buying Condo's to rent out so I can get income to live in Pattaya 

 

I will have to withdraw the money from my retirement account though , but...I'm thinking I will have income coming in..

 

But then I'm thinking if I spend say 600,000 baht on a condo in the Nirun and it gets 4,500 baht a month rent ( if I can find a tenant) then after expenses it's going to take over 10 years to get the capital back.

 

I don't know ,is it worth the risk ?

Say I have 10 million baht in my retirement funds and I buy all these condo's and have only rent coming in  and no monthly retirement income from the savings account as I spend it all on condo's .

 

I do think low class condo's would be better to rent out , I don't like the Nirun ,last time I was there to look  it was 9am and shirtless farangs were just standing by doorways holding bottles of beer ,as I walked past one ,he lifted his beer up & he shouted out "bunny wabbit !!! Bunny Wabbit! 

 

So I kept walking 

I wouldn't buy an anchor if I didn't have a boat.  Then again, I could take my anchor with me if I needed.

[noobexpat]

OP was recently infecting a pattaya centric forum. 

Made about +100 posts in 3 months. All of them click bait nonsense, like he does here.

 

After being mercilessly mocked, he gave up. It took a lot though.

There's a lesson to be learned for the folks on here!!

 

[quake]

2 minutes ago, noobexpat said:

OP was recently infecting a pattaya centric forum. 

Made about +100 posts in 3 months. All of them click bait nonsense, like he does here.

 

After being mercilessly mocked, he gave up. It took a lot though.

There's a lesson to be learned for the folks on here!!

 

+1 

[scubascuba3]

They may start taxing the income soon

[khunPer]

7 hours ago, georgegeorgia said:

I don't know ,is it worth the risk ?

Real estate agents sometimes guarantee – no idea how they do, I wouldn't dare to believe in it... – a 6% payback on your investment for a condo to rent out.

 

So your 600,000 baht suggestion – if you can find a condo in that price level for renting out – gives you 36,000 baht a year minus rental tax. It will take you 19 year to recover the investment after tax and without interest loss, if the 6% guarantee works. Including interest loss the investment outcome might be between zero and a loss; only if you can resell the condo for a higher price than you paid for it, it will be a win situation.

 

Professional real estate investors in property for rent, calculates with rental income between 8% and 12% per year; i.e., in average 10% per year.

[JimTripper]

It's not income coming in until you break even.

[Jonsin]

1 hour ago, khunPer said:

Real estate agents sometimes guarantee – no idea how they do, I wouldn't dare to believe in it... – a 6% payback on your investment for a condo to rent out.

 

So your 600,000 baht suggestion – if you can find a condo in that price level for renting out – gives you 36,000 baht a year minus rental tax. It will take you 19 year to recover the investment after tax and without interest loss, if the 6% guarantee works. Including interest loss the investment outcome might be between zero and a loss; only if you can resell the condo for a higher price than you paid for it, it will be a win situation.

 

Professional real estate investors in property for rent, calculates with rental income between 8% and 12% per year; i.e., in average 10% per year.

 

[redwood1]

7 hours ago, NickyLouie said:

If anything you can film a reality show at the Nirun and it's bound to be a hit.

How about here comes Nirun boo boo

 

 

 

[JimTripper]

3 hours ago, khunPer said:

Real estate agents sometimes guarantee – no idea how they do, I wouldn't dare to believe in it... – a 6% payback on your investment for a condo to rent out.

 

So your 600,000 baht suggestion – if you can find a condo in that price level for renting out – gives you 36,000 baht a year minus rental tax. It will take you 19 year to recover the investment after tax and without interest loss, if the 6% guarantee works. Including interest loss the investment outcome might be between zero and a loss; only if you can resell the condo for a higher price than you paid for it, it will be a win situation.

 

Professional real estate investors in property for rent, calculates with rental income between 8% and 12% per year; i.e., in average 10% per year.

So if you're 50 you wake up at 69 and realize you're break even? After 19 years of hassle with tenants and renting it out? ????

 

You then have 3k baht a month coming in? That's hilarious. I guess rents may have gone up by then so you can charge more in rent???

[bkk_mike]

5 hours ago, scubascuba3 said:

They may start taxing the income soon

Rental income in Thailand would have already been taxable for people living here.

[Bobthegimp]

10 hours ago, georgegeorgia said:

Lately  have this fetish to think about buying Condo's to rent out so I can get income to live in Pattaya 

 

I will have to withdraw the money from my retirement account though , but...I'm thinking I will have income coming in..

 

But then I'm thinking if I spend say 600,000 baht on a condo in the Nirun and it gets 4,500 baht a month rent ( if I can find a tenant) then after expenses it's going to take over 10 years to get the capital back.

 

I don't know ,is it worth the risk ?

Say I have 10 million baht in my retirement funds and I buy all these condo's and have only rent coming in  and no monthly retirement income from the savings account as I spend it all on condo's .

 

I do think low class condo's would be better to rent out , I don't like the Nirun ,last time I was there to look  it was 9am and shirtless farangs were just standing by doorways holding bottles of beer ,as I walked past one ,he lifted his beer up & he shouted out "bunny wabbit !!! Bunny Wabbit! 

 

So I kept walking 

You're clearly "Nirun" material, so why not embrace it?  Flybird is even cheaper, though maintained to a much lower standard.  You could live in one of the condos and keep an eye on your tenants; the "millionaire next door" type of scenario.

[newnative]

      I think there are a number of people in Pattaya, like Peterw42, who successfully own rental properties for income, both houses and condos.  On Monday, we sold our house on the Darkside to an investor, who will rent it out.  He also bought the house across the street from us, also to rent out.   They are definitely out there--the last house we sold before the latest one also sold, to a Thai investor, as did a number of our condo sales, to both Thai and foreign investors.

      On this forum, you often hear more negative than positive comments, especially when it comes to real estate.   Generally that's true for about anything--people are more likely to complain than praise something.  Just human nature.   Our buyer was driving a brand new BMW X7 so it seems he is doing ok but I doubt he has, or will ever, post here to share his positive real estate experiences.

    My partner and I have had several condos that we rented out.  Never had trouble finding tenants, some good, some not so good--but all paid the rent.  In the end, we decided we were impatient types, and we would rather take a big immediate profit selling them, rather than wait for years of rent to add up to the same amount of profit.  So, we have been doing that--buy, fix-up, sell rather than rent it, and move on.   Different strokes.

    The OP apparently has 10 MB lying around all day eating bon bons and watching Netflix.  I think he needs to put some of it to work earning some money for him--he certainly doesn't need 10MB for his everyday living expenses for the next year or two--at 50,000 baht a month he only needs 1.2 MB to fund the next 2 years. 

    In his shoes, I would be conservative and not put everything in one basket.  He could certainly look for a rental along the lines of what Peterw42 mentioned, as one option.  A good suggestion from another poster was buying dividend stocks that pay a healthy dividend--something my partner and I are also doing.   I think he could safely buy a rental condo and put at least 3MB into dividend stocks and still have a healthy cash cushion.  If he leaves 5MB in cash, he'll be safely funded for the next 8.3 years at 50,000 baht a month, not counting what dividend or rental income comes in during that period.  If he does nothing, his 10MB runs out in 16.6 years, drawing the same 50,000 baht a month--likely drawing more a month down the road with inflation--and he could  also be drawing more each month now, as well, reducing the funded years. 

    The rental condo could, at some point, be his paid-off roof over his head--a big plus, I think, if he plans to be in Thailand long-term.  Short-term, I would skip real estate.  (One hard rule my partner and I had, we never bought a condo rental we wouldn't live in ourselves, if push came to shove--perhaps something to consider, as well, before any purchase.)

    There is some risk with stocks--be aware.  With the rise in interest rates this year, some safer choices in the way of bonds, CDs, etc. are now out there as an option that, I believe, are paying interest in the 5% range.  I don't know much about them but perhaps some other posters can enlighten us--or offer some other investment suggestions.  My partner and I also now have some cash just lying around eating bon bons.  

[Pattaya57]

OP might find this thread useful about someone who visited Nirun condo for 10 minutes. He saw people drinking at 10am though not 9am like this OP and nobody called him a "Bunny Wabbit"

 

Oh wait, it's the same OP!

 

Worth noting in last Nirun thread he said "Terrible place and I won't buy there"

 

[scubascuba3]

56 minutes ago, bkk_mike said:

Rental income in Thailand would have already been taxable for people living here.

Not enforced it seems, so maybe it will be enforced