Condo Rental Investment

[tommybkk]

I would like to know where it is best to invest?

A small studio unit with average seaviews in Pattaya Jomtien area,

or a studio/1 bedroom condo near the BTS in Bangkok?

Where would be the best option to invest and get rental revenue out of it,

I am talking about a condo unit preferably not more than 1 - 1.2M

I would like to rent for long term, at least 6 but more preferably 12 moths.

Where would be a good option?

[trogers]

I would like to know where it is best to invest?

A small studio unit with average seaviews in Pattaya Jomtien area,

or a studio/1 bedroom condo near the BTS in Bangkok?

Where would be the best option to invest and get rental revenue out of it,

I am talking about a condo unit preferably not more than 1 - 1.2M

I would like to rent for long term, at least 6 but more preferably 12 moths.

Where would be a good option?

You have answered your own question. Pattaya is a seasonal vacation spot - with low season and high season.

[weescotsguy66]

I would like to know where it is best to invest?

A small studio unit with average seaviews in Pattaya Jomtien area,

or a studio/1 bedroom condo near the BTS in Bangkok?

Where would be the best option to invest and get rental revenue out of it,

I am talking about a condo unit preferably not more than 1 - 1.2M

I would like to rent for long term, at least 6 but more preferably 12 moths.

Where would be a good option?

It depends on your location and your knowledge of the market.

I would say Bangkok but you can forget any condo near a BTS for that price probably one near the MRT.

[donx]

Taking the answer from a previous post by think_too_mut, he would recommend a Bangkok studio near a university.

[thibautm]

We have some developments for sale with rental income guarantee for 3 years (in Bangkok, Pattaya, Hua Hin, Phuket) and some developer financing. You can find more information on CompanyVauban.com.

For answer to your question, 80% of the foreign demand is on Sukhumvit near BTS for 1Bdr apartment. So you're looking for a rental investment you have to keep in mind this statistic.

For a budget 1-1.2 million THB you can not find on sukhumvit main area. And area far away is really difficult to rent / and for a good price so you will have a rental income each year inferior than in Sukhumvit / Silom / Sathorn.

Edited May 29, 2009 by dr_Pat_Pong
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[think_too_mut]

We have some developments for sale with rental income guarantee for 3 years (in Bangkok, Pattaya, Hua Hin, Phuket) and some developer financing. You can find more information on CompanyVauban.com.

For answer to your question, 80% of the foreign demand is on Sukhumvit near BTS for 1Bdr apartment. So you're looking for a rental investment you have to keep in mind this statistic.

For a budget 1-1.2 million THB you can not find on sukhumvit main area. And area far away is really difficult to rent / and for a good price so you will have a rental income each year inferior than in Sukhumvit / Silom / Sathorn.

An old trick "guaranteed rental income for 3 years" means the money is already inbuilt into the price. With lots of luck, you may even find a tenant and not have to pay from that upfront charge.

Foreign rental demand is a drop in the ocean, negligible. What matters is steady demand from Thais and they rarely seek Sukhumvit or places much over 10,000B. Since the OP is after investment regardless of location, anything that rents for 5-10K baht anywhere would do.

Agents like you do not cater for that market and your experience is not very applicable.

Best returns I saw (back in 2003) were 1 room studios 36sqm, 300K baht each, renting for 4K baht, nowhere near BTS/MTS, near factories in the suburbs. Never dormant, always in demand.

Thai landlords own many, even dozens of them, probably not even knowing what they own, it's through their lawyers. They don't give a shit about what views, pools, gyms, security...their tenants enjoy. A friend bought 2 units with tenants in 2002 and sold them with tenants last year, one of the condos had same tenants through both of sales. He had had no intention to ever step inside the condos, let alone live in there.

[trogers]

We have some developments for sale with rental income guarantee for 3 years (in Bangkok, Pattaya, Hua Hin, Phuket) and some developer financing. You can find more information on CompanyVauban.com.

For answer to your question, 80% of the foreign demand is on Sukhumvit near BTS for 1Bdr apartment. So you're looking for a rental investment you have to keep in mind this statistic.

For a budget 1-1.2 million THB you can not find on sukhumvit main area. And area far away is really difficult to rent / and for a good price so you will have a rental income each year inferior than in Sukhumvit / Silom / Sathorn.

An old trick "guaranteed rental income for 3 years" means the money is already inbuilt into the price. With lots of luck, you may even find a tenant and not have to pay from that upfront charge.

Foreign rental demand is a drop in the ocean, negligible. What matters is steady demand from Thais and they rarely seek Sukhumvit or places much over 10,000B. Since the OP is after investment regardless of location, anything that rents for 5-10K baht anywhere would do.

Agents like you do not cater for that market and your experience is not very applicable.

Best returns I saw (back in 2003) were 1 room studios 36sqm, 300K baht each, renting for 4K baht, nowhere near BTS/MTS, near factories in the suburbs. Never dormant, always in demand.

Thai landlords own many, even dozens of them, probably not even knowing what they own, it's through their lawyers. They don't give a shit about what views, pools, gyms, security...their tenants enjoy. A friend bought 2 units with tenants in 2002 and sold them with tenants last year, one of the condos had same tenants through both of sales. He had had no intention to ever step inside the condos, let alone live in there.

Not every owner of such class of property enjoy a stable long term tenant. Having stayed in a rental apartment with price of 3-4K/mth, I saw frequent turnover of tenants because of default in rent payment. Warning issued, door locked, and personal items confiscated.

An expat investing in such a class of property do need a Thai wife to do the leg work - sourcing and evaluating tenants, chasing on rents, evicting tenants, etc. Also, these are the housing that have rather high crime rates, including drug abuse, gambling, rapes and murder. If you compound in the admin cost, the returns do not look so great.

[think_too_mut]

Not every owner of such class of property enjoy a stable long term tenant. Having stayed in a rental apartment with price of 3-4K/mth, I saw frequent turnover of tenants because of default in rent payment. Warning issued, door locked, and personal items confiscated.

An expat investing in such a class of property do need a Thai wife to do the leg work - sourcing and evaluating tenants, chasing on rents, evicting tenants, etc. Also, these are the housing that have rather high crime rates, including drug abuse, gambling, rapes and murder. If you compound in the admin cost, the returns do not look so great.

It was a caricature but a true story. That particular one was on it's way to hel_l, that is why the guy sold it but he did the same thing in another building, a bit more upscale.

That's why I think it is best to be near Unis, condos in those buildings are easily rented and students depend on parents, hardly ever any default in payments, if yes, chunky deposit covers it.

Where my wife was living 2002 to 2006, KTA mansion, Soi Barbos, just off Soi 42 150m from Rama 4, was a building with 120 rooms, 44sqm each. Walking distance to BKK Uni, almost exclusivelly students living there, a constant procession of Uni uniforms on nice bodies. Some farang Uni teachers rent there too.

Never heard a loud party, no crime, no police, no visible drugs abuse, no defaults. The rent is 6-9K depending on the floor + marked up utilities.

That's above what factory workers or low income people would commit to pay, although most rooms had 2-3 students in there, sharing the cost.

Almost everybody spoke English.

In 2002 I asked if I could buy 1 room, they said 1 might be for sale, 350K baht. When I came back 3 months later with intention to buy a whole floor (12 rooms) they said that the majority owner bought the remaining rooms and has no plans to sell them. He joined 2 rooms and has No.1 parking spot for his Porche 911.

The building is well kept (no pool, gym, just a restaurant) and now looks nicer than back in 2002.