Thinking Condo? Think Bangkok !

[Harmonica]

We are at the crest of a 40-m real estate surge.

Anyone trying to sell you prop; run and hide; then watch. The drop will be something to behold.

[PeaceBlondie]

....... I'm looking for a condo in BKK nearer the other end of the scale - 1 or 2 beds with easy access to the skytrain. I'm not looking for massive investment potential, but modest rental income would be good. Any advice would be very welcome.

<{POST_SNAPBACK}>

Here's my advice, which is worth what you're paying for it:

Residential rental property in Thailand seems to rent out for 0.5% of the fair market value. Then there's vacancy rates, failure to pay rent, other expenses, condo fees to pay, etc. How are you going to make a decent return on your investment? Do the math; I doubt it works out to a net draw. And then there's the chance of not recouping your investment......

[jtb]

....... I'm looking for a condo in BKK nearer the other end of the scale - 1 or 2 beds with easy access to the skytrain. I'm not looking for massive investment potential, but modest rental income would be good. Any advice would be very welcome.

<{POST_SNAPBACK}>

Here's my advice, which is worth what you're paying for it:

Residential rental property in Thailand seems to rent out for 0.5% of the fair market value. Then there's vacancy rates, failure to pay rent, other expenses, condo fees to pay, etc. How are you going to make a decent return on your investment? Do the math; I doubt it works out to a net draw. And then there's the chance of not recouping your investment......

<{POST_SNAPBACK}>

I hear you loud and clear PB. Thanks for the advice. Nevertheless, I'm going to go ahead and buy something so if you, or anyone else reading this, could suggest an area of BKK that represents 'good value' (I use the term advisedly!) in the current climate, I'd be very grateful.

[Beer-diow, khao-neow, mai-an!]

Good for you jtb.

Globally property is over-priced, and in BKK also. Short term a correction is certainly possible. also, all the criticisms from those posters here on the board are valid.

However, taking a 7-10-year view, a location right in the centre of a growing city like Bangkok can't be a bad thing if the project is well run. Deomgaphics and the fact that it is increasingly a global market make that clear. In the future there will be a secondary Thai property market (the Japanese also believe in ghosts, but funnily enough once there was no more greenfield land in major cities they managed to overcome it!) helped by govt plans to introduce a secondary mortgage market. Building quality at top projects is also rising, so the old issue of "old is crap" will eventually fall by the wayside. As a metaphorical extension, how many areas of London/NY etc where no-one would have dreamed of living 10 years ago are now super hot?

Also, you can rent out a property...if lucky. Rental yields are pretty poor, admittedly, and tennats hard to find, but a good project in a good location still has some prospects.

Plus, China's secular uptrend in growth (all cyclical arguments aside) suggests a growing regional economy longer-term as well as upward pressuer on commodity prices; it may not mean higher high street prices, but concrete and steel 10 years out will cost more than now. In real terms (i.e., house prices vs. a DVD player or TV) prices will go higher over this kind of timeframe.

Having said that, if you want to buy now and sell at a profit in 2 years, your're out of luck.

[chingy_]

Having said that, if you want to buy now and sell at a profit in 2 years, your're out of luck.

don't need the luck, no thank i'll buy in 2 year from now and we'll see.

[bkkbound04]

so the market price is going to drop in 2 years and then increase after that?

...and u know this how??

[Beer-diow, khao-neow, mai-an!]

Have to say market prices should rightly make people nervous at the mo, but I got in 18 months ago, and for what I got then I'd get 25% - 30% less in the same area now. That's a real fire sale you're talking about there - sufficient to imply that your own employment and investments elsewhere in the globe wouldn't be safe. Only the very calm and cash rich should feel so happy at such a prospect.

I have no intention of selling on in the short term. I'll live in it very comfortably until the whole of the area is in the "how did yuo ever afford to buy here" category like the centre of most world cities...

[mbkudu]

I bought a 40 sq. meter studio condominium in Sukhumvit soi 18 one year ago

for 1.6 million baht. My tenant living in it has offered me 2.0 million baht. I will not sell it to him. I feel very confident that I made the right choice buying it.

[Beer-diow, khao-neow, mai-an!]

25% in one year. And people want to see a 20%+ fall next year and yet other things (i.e., jobs and salaries and off-shore holdings) remain unaffected...

[mbkudu]

The location and size of the unit is key. Outlying areas will not cost nearly as much and you'll probably get more area, but if you're renting or reselling, then you

won't make much. So, if you want to live in something, then something outside the central area is better. A friend of mine rents a condo unit in the Rama IV area that is bigger in area than mine, and the rent is about 4,000 baht less. His landlord wants 1.5 million for it. It is still near the sky train, but just being that much further from the downtown area makes it not as attractive an investment. The really big ones are harder to rent and keep long term tenants in. Going small is the way to go. It was for me because that's all I could afford. After a year of looking at things, it worked out the best.

Edited January 12, 2005 by mbkudu

[The Coder]

...$650,000...Le Raffine 24 is the latest posh condominium

I looked at the specs on their web site and would describe the quality of the outfitting as average. When considering a $650K price tag, the amenities are just plain pitiful and the first thing I would do is rip out the entire interior (floors, walls, and all), throw it all away, and start over with better quality products and furnishings.

Then there is their signature feature--the private swimming pool. A swimming pool would be a terrible negative in my experience, but not for the reasons you might expect. When I moved into my first condo in BKK, I would hear what sounded like a bass drum as if there was a band practicing nearby. I soon discovered this was the reverberations of each splash made in the indoor pool below. It would even vibrate my keyboard on the desk. Can only imagine how annoying a swimming pools beside, above, and below would be. I am sure sound proofing was not well thought out as their 10cm walls are just average like everything else.

Edited January 12, 2005 by The Coder

[Beer-diow, khao-neow, mai-an!]

Agree that that project is an expensive joke.

[chingy_]

so the market price is going to drop in 2 years and then increase after that?

...and u know this how??

<{POST_SNAPBACK}>

didn't say that i know, just wanna buy it in near future.

Edited January 13, 2005 by chingy_

[bkkbound04]

go 4 it fella