Bangkok Apartment Rental Prices

[NoSpeakIt]

what you are you basing the over supply of empty condo's on? my building has maybe 3 vacancies out of 30 rooms.

[Heng]

Supachai Mansion doesn't count. Kidding.

I think a lot of folks are adding their own emotional state to their opinions, at the same time looking at property classifieds as "evidence" of a glut in the rental market. True, there is oversupply, but they seem to feel the need to make it sound like no one is renting and landlords are going without. Just because you are passed over or if a landlord chooses not to negotiate with you on a particular occasion, doesn't mean it's the same deal for everyone else. It's like the folks who seem to think that ______ jewelry store is on the brink of going out of business or must be a money laundering front just because the store wouldn't negotiate with them on a particular gem or piece of jewelry.

[bkkjames]

what you are you basing the over supply of empty condo's on? my building has maybe 3 vacancies out of 30 rooms.

Well, not knowing much about your building I can say that if you believe all the news recently about property developers delaying or cancelling their builds, I would suggest it has something to do with supply and demand. Of course if you believe the property agents like CBRE and certain high-end developers, the market is always booming.

I think you will agree that many locals and some farangs buy up places as 'investments' to either flip or too hopefully rent out to someone. Most new builds with 100 or more units have considerably more than 10% non occupant rate. Of course there will be exceptions to this (ie those perhaps at the foot of a BTS).

Anyways, back to point of this topic... I posed a question are landlords actually getting the prices they are asking for?

When I was looking for a place last time around, my property agent showed me several places (20k-3k range). About half have not been lived in for years it seemed because it appears to me that A) the owners had a price stuck in their head and they were not willing to invest a satang in the room to upgrade it. The furnishings looked straight out of the 70's. Needless to say, I bet those places are still unrented.

The place I am in now (owned by an expat) is modernly furnished with western appliances, big plasma tv,, the works. Originally he asked for 29K for it. I asked if he would take 25k. He countered and said he had many people looking at it. I said, Ok, let me know by tomorrow regarding my offer. He called me the next day to accept. Now it may be a different situation at XYZ Apartment Building, but I have a feeling that most "condo" owners mark up their asking prices knowing full well that they will negotiate a bit down.

Heng, you are an owner... are you telling me that you would rather let the place sit empty for a year or two than negotiate a bit?

[Heng]

Heng, you are an owner... are you telling me that you would rather let the place sit empty for a year or two than negotiate a bit?

Not at all, J. I do negotiate, I just don't negotiate on each and every occasion. I do also have property that I do pass on would be tenants' offers as well.

It's not a black and white decision, although I can understand from the point of view of those who own little or no property here or anywhere else, it might seem that way.

[bkkjames]

Heng, you are an owner... are you telling me that you would rather let the place sit empty for a year or two than negotiate a bit?

Not at all, J. I do negotiate, I just don't negotiate on each and every occasion. I do also have property that I do pass on would be tenants' offers as well.

It's not a black and white decision, although I can understand from the point of view of those who own little or no property here or anywhere else, it might seem that way.

I do know some don't negotiate, been there done that but to finish this off cause it's getting nowhere fast, it just amazes me how people would rather keep their place empty for a year at 12X25K than take 23k for the place at the start. Obviously, you want clean quiet tennants that pay on time, but given that, it boggles the mind really.

I thought I did well in math in school, guess it's not up to standard.

[Heng]

Heng, you are an owner... are you telling me that you would rather let the place sit empty for a year or two than negotiate a bit?

Not at all, J. I do negotiate, I just don't negotiate on each and every occasion. I do also have property that I do pass on would be tenants' offers as well.

It's not a black and white decision, although I can understand from the point of view of those who own little or no property here or anywhere else, it might seem that way.

I do know some don't negotiate, been there done that but to finish this off cause it's getting nowhere fast, it just amazes me how people would rather keep their place empty for a year at 12X25K than take 23k for the place at the start. Obviously, you want clean quiet tennants that pay on time, but given that, it boggles the mind really.

I thought I did well in math in school, guess it's not up to standard.

I think more likely you're just having cognitive dissonance that you didn't take their 25k price to begin with. I totally understand the plight of the renter (some, not all of course... I know very well of the minority who are renting for *other* reasons)... driving around or worse yet taking taxi's to far flung properties and in each case basically saying "I don't have a permanent place to live in this world, can I live here?... can you knock off 3,000 Baht off the rent?" I doubt very much that you're still "tracking" these apartments or properties after you find another place to live, unless you're some kind of real estate stalker.

On any of my condos (all of which are leased out by the way... my sitting empty properties are a mix of shophouses and undeveloped land), if the negotation involved a $100 price difference, as in your example above, I doubt you'll find too many, myself included that won't let you lease it... unless you're asking for a contract length (for myself, never less than two years and usually never more than three) or adding too many terms (I basically don't maintain or fix anything that can't be fixed by local condo management, stuff like that... mostly because I like fire and forget autopilot type income streams) that don't *jive* with what they are looking for.

Managing one's properties is not just simple math, but I'm sure you and anyone else who has played Monopoly knows this (but I'm sensing that maybe you were one of those kids who just rolled the dice/landed wherever, bought up property, and paid rent... instead of making property deals, which is the whole gist of the game). You don't take each and every offer, and yes, sometimes you just let your property sit there. It's the same in real life. You don't take every offer, sometimes you negotiate and sometimes you don't, and in fact sometimes you put up rental and for sale signs just to guage the market price, without any intention to rent or sell.

[bkkjames]

Heng, you are an owner... are you telling me that you would rather let the place sit empty for a year or two than negotiate a bit?

Not at all, J. I do negotiate, I just don't negotiate on each and every occasion. I do also have property that I do pass on would be tenants' offers as well.

It's not a black and white decision, although I can understand from the point of view of those who own little or no property here or anywhere else, it might seem that way.

I do know some don't negotiate, been there done that but to finish this off cause it's getting nowhere fast, it just amazes me how people would rather keep their place empty for a year at 12X25K than take 23k for the place at the start. Obviously, you want clean quiet tennants that pay on time, but given that, it boggles the mind really.

I thought I did well in math in school, guess it's not up to standard.

I think more likely you're just having cognitive dissonance that you didn't take their 25k price to begin with. I totally understand the plight of the renter (some, not all of course... I know very well of the minority who are renting for *other* reasons)... driving around or worse yet taking taxi's to far flung properties and in each case basically saying "I don't have a permanent place to live in this world, can I live here?... can you knock off 3,000 Baht off the rent?" I doubt very much that you're still "tracking" these apartments or properties after you find another place to live, unless you're some kind of real estate stalker.

On any of my condos (all of which are leased out by the way... my sitting empty properties are a mix of shophouses and undeveloped land), if the negotation involved a $100 price difference, as in your example above, I doubt you'll find too many, myself included that won't let you lease it... unless you're asking for a contract length (for myself, never less than two years and usually never more than three) or adding too many terms (I basically don't maintain or fix anything that can't be fixed by local condo management, stuff like that... mostly because I like fire and forget autopilot type income streams) that don't *jive* with what they are looking for.

Managing one's properties is not just simple math, but I'm sure you and anyone else who has played Monopoly knows this (but I'm sensing that maybe you were one of those kids who just rolled the dice/landed wherever, bought up property, and paid rent... instead of making property deals, which is the whole gist of the game). You don't take each and every offer, and yes, sometimes you just let your property sit there. It's the same in real life. You don't take every offer, sometimes you negotiate and sometimes you don't, and in fact sometimes you put up rental and for sale signs just to guage the market price, without any intention to rent or sell.

I will ignore the cognative dis comment because I did offer 25k and they did take it. No need to track those 70's units because if they haven't been rented in 10 years, unlikely a blind person would have stumbled upon them in the last year or two since I last visited.

I have friends that own several rental properties and the key point for them was to keep them occupied all the time with people who pay rent. Whether is 25k or 23k they didn't really seemed worried about it as long as it was rented 12 months a year, every year. That's the point of having a rental property isn't it to earn revenue? I did ask them if they negotiate and all 3 of the guys said it depends, "If I advertise the place for 20k a month and someone takes it immediately, then I am asking too little said one??" or "If I advertise it for 25 and nobody takes it for two months, I have lost 2 x 20k in order to make earn my original ask price, it's a tough call."

In closing (or do you feel the need to get in the last word), from previous posts where I exampled some condos for rent, I was wondering if people are actually getting these types of prices? If so, then maybe I will buy a few to rent out

[Briggsy]

In answer to the OP's question, beware the apartments that only advertise in English as this is a pretty good indicator that it is overpriced.

And completely avoid those apartments that advertise only in English and in a currency other than Baht. This is a surefire indicator that the apartment is ridiculously overpriced.

Oh, and yes, gullible mugs get off the plane every day at Suvannaphum, do no research at all of local prices and pay so far over the odds that it is quite unbelievable.

Edited July 11, 2008 by Briggsy

[bkkjames]

In answer to the OP's question, beware the apartments that only advertise in English as this is a pretty good indicator that it is overpriced.

And completely avoid those apartments that advertise only in English and in a currency other than Baht. This is a surefire indicator that the apartment is ridiculously overpriced.

Oh, and yes, gullible mugs get off the plane every day at Suvannaphum, do no research at all of local prices and pay so far over the odds that it is quite unbelievable.

you have a point there, the best deals are found on Thai websites like homedd.com etc.

[Heng]

I will ignore the cognative dis comment because I did offer 25k and they did take it. No need to track those 70's units because if they haven't been rented in 10 years, unlikely a blind person would have stumbled upon them in the last year or two since I last visited.

I have friends that own several rental properties and the key point for them was to keep them occupied all the time with people who pay rent. Whether is 25k or 23k they didn't really seemed worried about it as long as it was rented 12 months a year, every year. That's the point of having a rental property isn't it to earn revenue? I did ask them if they negotiate and all 3 of the guys said it depends, "If I advertise the place for 20k a month and someone takes it immediately, then I am asking too little said one??" or "If I advertise it for 25 and nobody takes it for two months, I have lost 2 x 20k in order to make earn my original ask price, it's a tough call."

In closing (or do you feel the need to get in the last word), from previous posts where I exampled some condos for rent, I was wondering if people are actually getting these types of prices? If so, then maybe I will buy a few to rent out

You're looking at places that haven't been rented in 10 years? So you're not even keeping track? Again, that still sounds like a cog-dis/sour grapes mentality. Not saying it is, of course... but it certainly sounds that way.

There's nothing wrong with a near term mentality in terms of rental income maximization. Some folks don't like to keep their properties in a management intensive state though... and that's what you're doing if you're willing to let one tenant rent for a few months, and then another one for half a year, and constantly taking the "first offer" that pops up, etc. For my own properties, we have to go through the process of getting their phones, electric, and water set up in their own name(s)... which requires our power of attorney or if we're available, the particular family member who owns the property has to show up, and that's not something we typically like to do on a yearly basis, especially if said family member is a relatively busy individual or say over 80 years old. That's just an example, though as each property/tenant match has its unique characteristics.... and again, it's not as simple as 'keep it rented all the time no matter what the other considerations may be.'

[bkkjames]

I will ignore the cognative dis comment because I did offer 25k and they did take it. No need to track those 70's units because if they haven't been rented in 10 years, unlikely a blind person would have stumbled upon them in the last year or two since I last visited.

I have friends that own several rental properties and the key point for them was to keep them occupied all the time with people who pay rent. Whether is 25k or 23k they didn't really seemed worried about it as long as it was rented 12 months a year, every year. That's the point of having a rental property isn't it to earn revenue? I did ask them if they negotiate and all 3 of the guys said it depends, "If I advertise the place for 20k a month and someone takes it immediately, then I am asking too little said one??" or "If I advertise it for 25 and nobody takes it for two months, I have lost 2 x 20k in order to make earn my original ask price, it's a tough call."

In closing (or do you feel the need to get in the last word), from previous posts where I exampled some condos for rent, I was wondering if people are actually getting these types of prices? If so, then maybe I will buy a few to rent out

You're looking at places that haven't been rented in 10 years? So you're not even keeping track? Again, that still sounds like a cog-dis/sour grapes mentality. Not saying it is, of course... but it certainly sounds that way.

There's nothing wrong with a near term mentality in terms of rental income maximization. Some folks don't like to keep their properties in a management intensive state though... and that's what you're doing if you're willing to let one tenant rent for a few months, and then another one for half a year, and constantly taking the "first offer" that pops up, etc. For my own properties, we have to go through the process of getting their phones, electric, and water set up in their own name(s)... which requires our power of attorney or if we're available, the particular family member who owns the property has to show up, and that's not something we typically like to do on a yearly basis, especially if said family member is a relatively busy individual or say over 80 years old. That's just an example, though as each property/tenant match has its unique characteristics.... and again, it's not as simple as 'keep it rented all the time no matter what the other considerations may be.'

Ok to all that Heng - now do u have an opinion the topic as posted. You could always start your own "Why I leave my rental properties vacant" or "Why I don't negotiate on price with Farang" haha.

[bkkjames]

Regarding the oversupply comment I offer this....

Bangkok Post July 1

PROPERTY

Tight credit hurts developers

NUNTAWUN POLKUAMDEE

Property companies are likely to face growing liquidity constraints as banks tighten their new lending criteria due to economic uncertainties.

Meanwhile, the window for companies to raise funds from the equities or bond markets has also closed due to poor market sentiment, according to Pumipat Sinacharoen, a corporate planning executive of SET-listed Asian Property Development (AP).

((search www.bangkokpost.com for continued article))

I am no accountant but those figures seem to add up to over supply?

[Heng]

I will ignore the cognative dis comment because I did offer 25k and they did take it. No need to track those 70's units because if they haven't been rented in 10 years, unlikely a blind person would have stumbled upon them in the last year or two since I last visited.

I have friends that own several rental properties and the key point for them was to keep them occupied all the time with people who pay rent. Whether is 25k or 23k they didn't really seemed worried about it as long as it was rented 12 months a year, every year. That's the point of having a rental property isn't it to earn revenue? I did ask them if they negotiate and all 3 of the guys said it depends, "If I advertise the place for 20k a month and someone takes it immediately, then I am asking too little said one??" or "If I advertise it for 25 and nobody takes it for two months, I have lost 2 x 20k in order to make earn my original ask price, it's a tough call."

In closing (or do you feel the need to get in the last word), from previous posts where I exampled some condos for rent, I was wondering if people are actually getting these types of prices? If so, then maybe I will buy a few to rent out

You're looking at places that haven't been rented in 10 years? So you're not even keeping track? Again, that still sounds like a cog-dis/sour grapes mentality. Not saying it is, of course... but it certainly sounds that way.

There's nothing wrong with a near term mentality in terms of rental income maximization. Some folks don't like to keep their properties in a management intensive state though... and that's what you're doing if you're willing to let one tenant rent for a few months, and then another one for half a year, and constantly taking the "first offer" that pops up, etc. For my own properties, we have to go through the process of getting their phones, electric, and water set up in their own name(s)... which requires our power of attorney or if we're available, the particular family member who owns the property has to show up, and that's not something we typically like to do on a yearly basis, especially if said family member is a relatively busy individual or say over 80 years old. That's just an example, though as each property/tenant match has its unique characteristics.... and again, it's not as simple as 'keep it rented all the time no matter what the other considerations may be.'

Ok to all that Heng - now do u have an opinion the topic as posted.

Sure do, you've just read through some of them.

In summary: some DO for various reasons, and some DO NOT, again for various reasons. And when people don't get the property they make an offer for -whether to rent or to buy-, it's not the end of the world, no reason to hold a grudge, there are plenty of properties out there for them to go after.

[Tyke]

I pay 35000 pm for 105 sqm 35fl immediately next to BTS in Sathorn but building work and school nearby iare a bit of a bind and the flat needs an upgrade a bit.

[Moonfruit]

Nobody seems to mention that people generally ask for a rental amount that gives them a pre-determined return on their investment on that unit.

James seems to think that numbers are pulled out of hats. However, what i and those property owners that i know do is a bunch of simple maths that will allow me to arrive at my desired cashflow per month from the property, equivalent to x% yield.

If someone comes and tries to bargain me down, I would be saying no, but then again because the maths are simple and anybody who is smart enough can figure it out for themselves they know that my required rent is reasonable. So reasonable in fact that in one property Ive had the same tenant since i left the UK 8 years ago!

P.S. None of my property is in Thailand or any other developing country. I value the tangible rewards of capital gains too much which i am not confident that Thai property can produce, though that is obviously debatable.

[smileplur]

7000 per month gets me a large one bedroom apartment with living room, dining room, kitchen, and washing area in a secure building near Ratchaparop.

[Tyke]

Nobody seems to mention that people generally ask for a rental amount that gives them a pre-determined return on their investment on that unit.

James seems to think that numbers are pulled out of hats. However, what i and those property owners that i know do is a bunch of simple maths that will allow me to arrive at my desired cashflow per month from the property, equivalent to x% yield.

If someone comes and tries to bargain me down, I would be saying no, but then again because the maths are simple and anybody who is smart enough can figure it out for themselves they know that my required rent is reasonable. So reasonable in fact that in one property Ive had the same tenant since i left the UK 8 years ago!

P.S. None of my property is in Thailand or any other developing country. I value the tangible rewards of capital gains too much which i am not confident that Thai property can produce, though that is obviously debatable.

Hope your property is not in the USA, UK, Europe or any other 'developed' country Oooops.