3-5,000,000 Bkk Condo

[mauiguy90]

If you want a new condo, or even something 5 years old or less, in the Phrom Phong/Thonglo area close to the BTS, you will pay no less than 80K per sq. meter and probably closer to 100K per sq. meter. For 5 million baht, that means you will be getting a condo of 50 sq. meters, possibly 60 sq meters(further away from BTS). Generally that means a 1 bedroom condo shell, which will not get you 40k per month, unless your place has an outstanding view and luxuriously decorate yourself for another 1 million baht or so.

Looking at your investment from another angle, if you want a 40K return from a 5 million baht investment, you are essentially looking for a 10% return on your investment. Realistically, most real estate people will tell you that you can expect a return of 5-7% on your investment. Essentially with a 7% return (not including maintenance fees and other costs, assuming your condo is never empty), you can expect to get 30K in rent per month. If you do want more bang for your buck, you might consider an older condo which will give you a larger condo for the same amount of money, then plush it up.

Finally, there are very few condo projects close to the BTS Phrom Phong/Thonglo that are about 5 years old. Most are newly built or are in the process of being built. One of the few that I know of which is about 5 years or so old is Citismart condo on Sukhumvit 18. There are also a couple of smaller projects around like 38 Plus in the Thonglo area.

Unless there is a huge economic crisis like that of 1997, don't expect prices to seriously drop. The thai real estate market is unfortunately, quite resistant to price changes, even though the economy right now sucks!

[DegenFarang]

Two very solid posts, thanks a lot!

[AddictedToThai]

Anybody know if rental income from condo's is taxable in Thailand? I know capital gains taxes are not and interest income is, correct?

Yes it is taxable

More info here http://www.rd.go.th/publish/6045.0.html

[DegenFarang]

Anybody know if rental income from condo's is taxable in Thailand? I know capital gains taxes are not and interest income is, correct?

Yes it is taxable

More info here http://www.rd.go.th/publish/6045.0.html

“Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand.

Does most people actually do this...?

Edited January 12, 2010 by DegenFarang

[trogers]

For less than 5 mil baht it is possible to snap a 1-bed at Wind 23 or Aguston condos from Major Development on resale market. Both condos are brand new Grade-A buildings which was just completed. If 48 sqm studio is OK than it can be an Emporio Place a few steps from Phrom Pong BTS and Emporium.

There are also new very well priced small condos inside Suk 49 soi for 75-90,000 per sqm.

Avoid developments of Major. They are known to cut corners and push the blame on to the consultants. Buyers are shocked on inspection of unit before transfer, many changes in specifications from that presented in brochure and show unit.

[AddictedToThai]

Avoid developments of Major. They are known to cut corners and push the blame on to the consultants. Buyers are shocked on inspection of unit before transfer, many changes in specifications from that presented in brochure and show unit.

At least at these particular projects you can see what you're investing in as they are ready for inspection. Anyway the prices on the resale market are reasonable, significantly less than developer's

[AddictedToThai]

“Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand.

Does most people actually do this...?

I think most people even do not know that they have to.

But this is reasonable. You live in the country and use its benefits provided by the government. Therefore you have to pay for that as Thais do.

[trogers]

Avoid developments of Major. They are known to cut corners and push the blame on to the consultants. Buyers are shocked on inspection of unit before transfer, many changes in specifications from that presented in brochure and show unit.

At least at these particular projects you can see what you're investing in as they are ready for inspection. Anyway the prices on the resale market are reasonable, significantly less than developer's

And such lowering of prices during initial transfer of the project points to 2 potential problems - how far can prices fall? and will the project be poorly occupied and maintained?

[AddictedToThai]

And such lowering of prices during initial transfer of the project points to 2 potential problems - how far can prices fall? and will the project be poorly occupied and maintained?

From my experience it is not so easy to get the price in the lowest end as those units are sold fast even in this time. But such offers pop up regularly on prakard.com in almost all popular developments that are near completion.

And it seems resale prices tend to stabilize and become closer to the developer's offers after most of the units transferred. Partly this is due to sellers having to pay high income tax on reselling transferred units.

In my opinion the projects from the leaders Major, Sansiri, AP are well maintained (by thai standards).

[trogers]

And such lowering of prices during initial transfer of the project points to 2 potential problems - how far can prices fall? and will the project be poorly occupied and maintained?

From my experience it is not so easy to get the price in the lowest end as those units are sold fast even in this time. But such offers pop up regularly on prakard.com in almost all popular developments that are near completion.

And it seems resale prices tend to stabilize and become closer to the developer's offers after most of the units transferred. Partly this is due to sellers having to pay high income tax on reselling transferred units.

In my opinion the projects from the leaders Major, Sansiri, AP are well maintained (by thai standards).

Resale prices falling to near a developer's prices is different from 'significantly less than developer's prices'. The latter implies something is drastically wrong. I just heard the words 'karn ka hard' standard 2 days ago from a supplier to these projects.

[DegenFarang]

“Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand.

Does most people actually do this...?

I think most people even do not know that they have to.

But this is reasonable. You live in the country and use its benefits provided by the government. Therefore you have to pay for that as Thais do.

Sure it is reasonable but I had no idea such a law existed.

Edit: So wait. As a foreigner we are required to bring money into the country to buy a condo. According to this law, shouldn't we be bringing the money in, then paying Thai taxes on it, then buying a condo with whatever is left over...?

Edited January 12, 2010 by DegenFarang

[DegenFarang]

And such lowering of prices during initial transfer of the project points to 2 potential problems - how far can prices fall? and will the project be poorly occupied and maintained?

From my experience it is not so easy to get the price in the lowest end as those units are sold fast even in this time. But such offers pop up regularly on prakard.com in almost all popular developments that are near completion.

And it seems resale prices tend to stabilize and become closer to the developer's offers after most of the units transferred. Partly this is due to sellers having to pay high income tax on reselling transferred units.

In my opinion the projects from the leaders Major, Sansiri, AP are well maintained (by thai standards).

Resale prices falling to near a developer's prices is different from 'significantly less than developer's prices'. The latter implies something is drastically wrong. I just heard the words 'karn ka hard' standard 2 days ago from a supplier to these projects.

Sorry if I'm not understanding this but I have seen several developments selling units for prices well above what identical units are selling for on prakard.com

[trogers]

And such lowering of prices during initial transfer of the project points to 2 potential problems - how far can prices fall? and will the project be poorly occupied and maintained?

From my experience it is not so easy to get the price in the lowest end as those units are sold fast even in this time. But such offers pop up regularly on prakard.com in almost all popular developments that are near completion.

And it seems resale prices tend to stabilize and become closer to the developer's offers after most of the units transferred. Partly this is due to sellers having to pay high income tax on reselling transferred units.

In my opinion the projects from the leaders Major, Sansiri, AP are well maintained (by thai standards).

Resale prices falling to near a developer's prices is different from 'significantly less than developer's prices'. The latter implies something is drastically wrong. I just heard the words 'karn ka hard' standard 2 days ago from a supplier to these projects.

Sorry if I'm not understanding this but I have seen several developments selling units for prices well above what identical units are selling for on prakard.com

What kind of investment time frame do you have in mind? A short period (2-3 years) means you hope for capital appreciation. If not, rental yield is important to you.

The 2 most significant factors for rental yield is location and class of the community occupying the development. Does the development consists largely of studio units with some 15-20% 2-bedroom and penthouses? If so, anticipate friction between differing social classes that will occupy the development.

[DegenFarang]

Checked out Emporio today, very nice development, but two major drawbacks. It is pretty deep down the Soi, took me probably ten minutes to walk from the BTS. Second is Bright24 is under construction across the street, and loud, sign says completion in December 2011, so at least two more years of incessant noise pollution.

I inspected a gorgeous two bedroom duplex on the 12th floor of the North tower. 15.3 million at roughly 120,000/square meter. All units are ready for move-in now (contrary to what I had read some places online saying move in was late this month or in February).

How's that price sound? Anybody got a guess what a unit like that would rent for? Lady said 40,000 baht per month but just looking at the place I know that can't be right.

[AddictedToThai]

Resale prices falling to near a developer's prices is different from 'significantly less than developer's prices'.

The difference can be big, eg. in Aguston 95,000 per sqm is the lowest end on resale market and 120,000 psqm from the developer.

But there are not many units for 95,000 psqm there. Maybe 1-2 of total 20 offers on prakard. Still this price is higher than presale project prices 3 years ago. I understand the low priced units are from the sellers who do not have money to pay the last payment for the transfer which is 70% of the unit price. After the unit transferred the seller will add 200-400,000 baht to the price as he has to pay income tax when he resells. I've seen that at Address Chidlom: plenty of good offers 3-5 months ago, now they've all disappeared.

Edited January 13, 2010 by AddictedToThai

[mauiguy90]

DG,

Tried to send you info for condos for sale close to the BTS Thonglo area by PM, but apparently your account is locked. Send me a PM if you want the info. Comes from an agent with Acute Realty that I contacted recently--prices in the 4 million baht price range.