Why Buy A House In Pattaya

[thaimate]

I have lived in Pattaya for many years ,have had a buisness in BKK and

for the life of me cannot understand why anyone would buy a house here ,a condo maybe ,but a house? friends who i know have in the past bought property but when they want to move find it almost immposable to sell, all the houses that were purchased on our estate,which by the way is very nice that have come up for sale are still years later ,exactly that ,for sale ,one which has had loads of work done and now fully furnished has been on the market two years and is being offered at the original buying price ,so whats the advantage in buying?

[PattayaParent]

They're much cheaper than condos and condos are impossible to sell also.

[mrbojangles]

Just using the pound as an example. If the house on your estate was bought when the baht was 70ish to the pound. Even if he sells it now at the price he bought it, he'll make about 30% when converted back to pounds.

For me that is the key. House prices (and Condo's) are extremely expensive at the moment due to the exchange rate. As you say, carry on renting.

[LennyW]

I would say the condos are far more difficult to move on - just far too much of them in Pattaya/Jomtien., but houses and condos do move if they are 1) well located, 2) well priced and 3)properly built/maintained - but you do need to fulfill all three points!!

Houses are always far better value for money, always a lot more property for a lot less baht / SqM.

You can never really compare houses and condos though - they represernt completely different lifestyles.

You cannot understand why people would buy a house - i have great difficulty understanding why anyone would buy a condo, just walking into one gives me the creeps!!

[RabC]

Some of us bought our house to live in and not as an investment. In 10 years I will have recouped the money I would have spent in rent. I also do not wish to live in a pidegon hole on the 17th floor of some block and rely on hoping that the management run the block well and dont harm my property value.

[William Osborne]

Question doesn't make any sense if you're living in Thailand long term...why would anyone buy a house anywhere ?

You're always going to need to live somewhere and the money you will save on rent will cover the price of the house over 10-15 years...not a lot of time if you buy in your 30's, obviously is also a good insurance policy for your family if you croak it and if things go tits up a lot easier to walk away from a 2.5 mil house than a 150 k house back in UK..

Days of buying property to sell on for a profit are definitely gone but rental still ok if you're in a good village, although the exchange rate has well and truly screwed that up now..

Edited November 3, 2010 by William Osborne

[ArNaSu]

Buy a house to live in I suppose, that's why I bought. Don't really see why rentings such a great idea.

[craigt3365]

I've seen quite a few houses sold in our development. For sure things are slow...but that is true in many places worldwide. Spain, Ireland, part of the US, parts of the UK, etc. It's not just Thailand. But with these depressed prices, it's not a bad time to buy if you are in it for the long term. Some really good deals out there.

If you rent, you had better have a source of income that is inflation adjusted. Rent that is, say, 20k Baht today could easily be 40k Baht in 20 years, or less. Especially here in a high growth area like Asia. My house is paid off...so living is now fairly cheap here.

Prices will go up. Activity will go up. But it's going to be a few years for sure. As mentioned above, properties in a good location, well kept, and priced properly will sell...

[Thailaw]

While the cost of ownership may well work out to be less than renting over a long period of time, probably 15+ years, owning a house in Pattaya (perhaps anywhere in Thailand) provides little flexibility or mobility, which is a great advantage to renting. If you make a conscious decision that you really like a house and the neighborhood that it is in and would be happy to live there for a very long time, then home ownership is probably a good way to go. If you want the flexibility to change houses, neighborhoods, towns or countries at some point, owning a home in Pattaya may complicate that decision considerably or at least make it very expensive when you realize what your house is "worth" relative to what you paid for it "x" years ago. If you keep the price of the house to below B2 million, so that it is affordable to middle class Thais (and buy in a village with a mixed population), you will likely broaden the market and increase the chances of selling a home. When you get above B10 million, you are in a market where only farang (and a few wealthy Thais) roam, and political events and exchange rates can and will seriously affect the ability to sell your home, regardless of its general appeal. Thailand is no longer a "cheap" place to live, so in addition to house prices rising in terms of Dollars, Pounds and Euro, the cost of everything else has increased also, so fewer foreigners are considering Thailand as a place to live and/or retire. So, you get the double effect of fewer people in the market and higher prices of houses driving many away from buying a home. Is it likely to get worse? Probably, yes. So, if you don't already own a house here in Thailand, unless you can get a really good deal on a home (where the price truely reflects the "market" and would allow you to sell it on relatively quickly at near what you paid for it -- rare occurrence), you are probably better renting.

[jori]

Buying property in Thailand? You must be off your rocker. One motto always buy with easy selling potential, that will never happen now in Thailand, may have a less than an outside chance this side of the Suk, other side not a hope in hel_l, look at the notice boards in Foodland etc especially at uncompleted works, wanting partnerships to complete high end housing then selling on. One farang guy built 46 houses sold 6 at completion long while ago ,now 40 to sell, he knows he is wiped out. Condos offer far more security than houses, come darkness a need to get back to the house is prime concern, knocking off 3 to 4 hours of a days enjoyment.

Just returned from Malaysia looking at property there, better built, cheaper but still caught pneumonia. Am buying in Cyprus (looked at Spain) utter devastation on selling now, buying there at rock bottom, literally picking someone’s bones, buying off some guys estate (he topped himself at being wiped out) Selling in both Cyprus and Spain is more fundamental and problematic than here because it has been ongoing for so long, here it has been the last 6 months or so, but it will get the same here as there , perhaps worse

Far too many problems here in Thailand with land ownership, buying the company route will bite you in the ass eventually as others not too far away have found out. Got a company? Need a business visa, that’s x amount more, doing accounts? here’s x amount of minimal tax demand, all made retrospectively .Always advised never to buy in a country that you need a visa to live in, ignored that advice years ago, same –same as Thailand, sold up and got out by the skin of my teeth, but was not troubled by falling property values as here, made a good profit (still sending me tax demands from there too the cheeky b*******s for capital gains) but left thousands of mainly Brits and Europeans without homes, along with visa conditions rapidly changing. Please no advice on buying through Thai national, now that is head banging stuff

Thoughts of free and full medical care at a certain age, winter fuel allowance for those chilly Cypriot nights, some of the best coral reef diving beds, all those Greek islands a days sailing away, some certainly but not all of the advantages

Edited November 3, 2010 by Rimmer

[morphious]

Condos are the work of the devil, a house for me everytime.

[Tolley]

Unless you are buying the property as security for your wife or girlfriend I don't really see any advantage in buying in Thailand and I can see way too many disadvantages.

The argument that the purchase price pays for itself if you live there for 10 or 15 years doesnt really wash as the money you spend on buying the property could have been invested and you could have made up any rental shortfall by your investment.

The list of disadvantages are so long that it just doesn't bear writing them down.

[PattayaParent]

To some people buying a property, whether it's a house or a condo, is not an investment but a home to live in and to leave to the kids in future.

Brits in particular seem to have the home owner mentality as in Europe prices are much higher.

[Jingthing]

So far I am still very, very happy that I bought a condo here. I happen to like condo living. A lot of people do. It's a matter of preference, living in a house is not better if you prefer the advantages of condo living. As far as finances, I was lucky to buy at a time of relative baht weakness. If I had to rent the place I was living in now the actual dollar cost to me (as I am dollar based) would be quite burdensome. As it is now, the rent is covered as there is no rent, and I am decently positioned to be able to stay in Thailand (which is what I want) with a strong baht. Of course timing and luck come into play. As far as buying now, that's another story!

[canuckamuck]

No problem selling a house, if you have 2 years to wait.

[moo9]

Usually one should not buy a house for investment but for living there.

Investments are fully facing the currency and other risks. How many people went over board believing in an ever lasting real estate bubble? I agree to another poster, compared with houses, condos are quite expensive.

[CGW]

Some of us bought our house to live in and not as an investment. In 10 years I will have recouped the money I would have spent in rent. I also do not wish to live in a pidegon hole on the 17th floor of some block and rely on hoping that the management run the block well and dont harm my property value.

Agreed, whatever happened to "quality" of life, rather than considering money!

[RabC]

Unless you are buying the property as security for your wife or girlfriend I don't really see any advantage in buying in Thailand and I can see way too many disadvantages.

The argument that the purchase price pays for itself if you live there for 10 or 15 years doesnt really wash as the money you spend on buying the property could have been invested and you could have made up any rental shortfall by your investment.

The list of disadvantages are so long that it just doesn't bear writing them down.

Your argument makes no sense, if you did not buy then there would still be no money to invest as you would be paying it in rent. I would also like to see any investment at present that would return 25000 baht/month which is what my place would cost to rent, for an outlay of 4 million baht.

To use your arguement if I own the house, then allowing for the 10/15 years to recoup my original outlay leaves me the rest of my life to invest the money that non owners would still be paying in rent.

[William Osborne]

Condos offer far more security than houses, come darkness a need to get back to the house is prime concern, knocking off 3 to 4 hours of a days enjoyment.

...you must lead a nice life with paranoia like that

[puuchai299]

Sitting in my garden chilling amongst the beautiful butterflies dancing around the trees and flowers is my idea of enjoyment,looking in a bank book never gave me that.No regrets.

[easyride]

Unless you are buying the property as security for your wife or girlfriend I don't really see any advantage in buying in Thailand and I can see way too many disadvantages.

I wouldn't buy a brick in Thailand, nothing beneficial as far as I can see and dozens of 'family' crawl out of the woodwork.

Then there's the gritty tasting tea you get as soon as the ink is dry................................

[Thailaw]

Sitting in my garden chilling amongst the beautiful butterflies dancing around the trees and flowers is my idea of enjoyment,looking in a bank book never gave me that.No regrets.

Do the butterflies look more beautiful because you own the house rather than rent it? I rather doubt that they do. The issue is not should you live in a house (and watch butterflies) or live in a condo (which I assume is the other option), but should you own the house or rent it in Thailand/Pattaya.

[Thailaw]

Unless you are buying the property as security for your wife or girlfriend I don't really see any advantage in buying in Thailand and I can see way too many disadvantages.

The argument that the purchase price pays for itself if you live there for 10 or 15 years doesnt really wash as the money you spend on buying the property could have been invested and you could have made up any rental shortfall by your investment.

The list of disadvantages are so long that it just doesn't bear writing them down.

Your argument makes no sense, if you did not buy then there would still be no money to invest as you would be paying it in rent. I would also like to see any investment at present that would return 25000 baht/month which is what my place would cost to rent, for an outlay of 4 million baht.

To use your arguement if I own the house, then allowing for the 10/15 years to recoup my original outlay leaves me the rest of my life to invest the money that non owners would still be paying in rent.

You may disagree with Tolley's argument, but it certainly makes sense. His point is that if you take the B4,000,000 (to use your example) that you would have used to buy a house in Pattaya and invest it, the return on the investment can be used to pay the rent on the same house (if rented and not owned). If the monthly rent on a B4 million house is B25,000 (I expect that in the current market it is actually considerably less than that, but B25,000 may be a good long term average monthly rent on a B4 million house), that would require a return of 7.5% on a B4 million investment to make the rental payments and leave the principal untouched. You certainly don't in any event plunk down 10 to 15 years of rent payments at the beginning of the lease term. And the investment return does not stop at the end of 10/15 years, as you seem to suggest, but goes on indefinately (as does the use of a house that you own -- same, same). Seven and a half percent return in today's investment market may be on the high side (although you certainly could have outdone that in the Thai stock market over the last year), but most investors would see an average relatively low risk return of 7.5% as modest and achievable.

[Englander]

All property will sell, all you need to do is offer it as the right price.

[kevkev1888]

All property will sell, all you need to do is offer it as the right price.

Exactly!!!

[Barack]

Not going to get in the condo vs house debate as one shoe doen't fit everybody but having a title in my own name is most important for me so I buy condos. Also, for years on TV there has been an on-going renting vs buy debate. I bought my condos when the exchange rate was almost 40 THB/USD. I have Brit friends who purchased when pound was 65-70 THB/GPB. Well there's talk now of the dollar sinking to 25 and the pound currently well below 50 to fall also. So who is laughing now? Some distraught renter friends are bemoaning the falling pound and considering returning to England. Others who bought are enjoying a happy retirement. Lessons learned, Economics 101, if retired or nearing retirement get your housing costs fixed first. (i.e., buy). In closing, I just wanted to thank my renters over years for paying my mortgages and financing my retirement.

[moo9]

Not going to get in the condo vs house debate as one shoe doen't fit everybody but having a title in my own name is most important for me so I buy condos. Also, for years on TV there has been an on-going renting vs buy debate. I bought my condos when the exchange rate was almost 40 THB/USD. I have Brit friends who purchased when pound was 65-70 THB/GPB. Well there's talk now of the dollar sinking to 25 and the pound currently well below 50 to fall also. So who is laughing now? Some distraught renter friends are bemoaning the falling pound and considering returning to England. Others who bought are enjoying a happy retirement. Lessons learned, Economics 101, if retired or nearing retirement get your housing costs fixed first. (i.e., buy). In closing, I just wanted to thank my renters over years for paying my mortgages and financing my retirement.

So what is EURO, USD against the THB in August 2012, as it seems that you are competent to predict the exchanges rates?

You are only part of a big game and sometimes you are lucky with your exchange rate. It always remains risky to investment your money in a foreign currency, no matter what people are telling you. Windfall profits can go as quickly as they came!

[Naam]

Some of us bought our house to live in and not as an investment. In 10 years I will have recouped the money I would have spent in rent. I also do not wish to live in a pidegon hole on the 17th floor of some block and rely on hoping that the management run the block well and dont harm my property value.

nothing to add!

[craigt3365]

Unless you are buying the property as security for your wife or girlfriend I don't really see any advantage in buying in Thailand and I can see way too many disadvantages.

The argument that the purchase price pays for itself if you live there for 10 or 15 years doesnt really wash as the money you spend on buying the property could have been invested and you could have made up any rental shortfall by your investment.

The list of disadvantages are so long that it just doesn't bear writing them down.

Your argument makes no sense, if you did not buy then there would still be no money to invest as you would be paying it in rent. I would also like to see any investment at present that would return 25000 baht/month which is what my place would cost to rent, for an outlay of 4 million baht.

To use your arguement if I own the house, then allowing for the 10/15 years to recoup my original outlay leaves me the rest of my life to invest the money that non owners would still be paying in rent.

You may disagree with Tolley's argument, but it certainly makes sense. His point is that if you take the B4,000,000 (to use your example) that you would have used to buy a house in Pattaya and invest it, the return on the investment can be used to pay the rent on the same house (if rented and not owned). If the monthly rent on a B4 million house is B25,000 (I expect that in the current market it is actually considerably less than that, but B25,000 may be a good long term average monthly rent on a B4 million house), that would require a return of 7.5% on a B4 million investment to make the rental payments and leave the principal untouched. You certainly don't in any event plunk down 10 to 15 years of rent payments at the beginning of the lease term. And the investment return does not stop at the end of 10/15 years, as you seem to suggest, but goes on indefinately (as does the use of a house that you own -- same, same). Seven and a half percent return in today's investment market may be on the high side (although you certainly could have outdone that in the Thai stock market over the last year), but most investors would see an average relatively low risk return of 7.5% as modest and achievable.

Maybe the past year has been good in the stock market, but I am sure many took a beating for the few years before that. Unless you are a savvy investor, which I am not, current returns on many investments are in the toilet. If you can make 5%, guaranteed, that's not bad. And here in Thailand, it's basically tax free.

Real estate, historically, has returned 3% per year. Not great. Stocks usually do better. But like many have said, owning one's home is an important part of life. For me, I hate to rent. And am retired due to the money I made on real estate. If I had rented, I would still be working. I know so many people who have made big money on RE...over time. Both here and back home.

I met with some friends from New York City. They rented their entire 25 years while living in NYC. Real estate boomed. He's renting here in Bangkok now. No money to buy a condo. Think of how much money was wasted while renting for 25 years. Unreal...

I am meeting with a couple tonight who have more than doubled their investment in their condo in the past 8 years. Purchased it for 5M Baht, now on the market for 12. And it will sell. Location, location, location.

Buy a cheap condo or house in the wrong location and you will lose for sure. But if it is your castle, and you are in it for the long run, who cares?

But in the end, it's an individual's decision. It depends on your lifestyle, your financial situation, your desires. We are all different in these areas. As they say here, up to you! Neither decision is right or wrong.

[Thailaw]

...... Buy a cheap condo or house in the wrong location and you will lose for sure. But if it is your castle, and you are in it for the long run, who cares?

But in the end, it's an individual's decision. It depends on your lifestyle, your financial situation, your desires. We are all different in these areas. As they say here, up to you! Neither decision is right or wrong.

Your examples of buying real estate in the US are interesting, but not really relevant. Thailand real estate for foreigners has its own, unique issues and problems. US tax law is biased in favor of home ownership, especially when it is mortaged. But I doubt that your NY friend has no money for a condo in BKK because he rented in NY (most people in NY city are renters), and is probably a result of many broader financial decisions and spending behavior over a long period of time. I know many people in the US, mostly home owners (with substantial incomes and huge mortages) that have little to no net equity in their homes and live pretty much pay check to pay check (although they live very, very well). As you say, up to them....

But the problem here is that real estate of the kind purchased by foreigners here in Thailand is very illiquid. For every person that has or, as you speculate, will double their money on a house or condo purchase in Pattaya, there are 10 that have/will had their houses on the market (often vacant) for years and lose money on a house/condo purchase/sale (we could debate whether the loss would be a gain if and when converted back into foreign currency). That is due to some economic reasons to be sure, but also political reasons. And the inability to "own" land and a home doesn't help. I do agree that it is a function of price, and at some price everything is sellable. But most of us would rather hold a piece of real estate than to realize the loss by selling our home in a down (aka "dead") market (prices are "sticky downward"), "hoping" that the market will turn around and the price with return to its previous level -- unlikely to happen here, but you can always hope. If you have a crystal ball and know the future perfectly, and your decisions to buy a house here reflect that degree of certainty, then as you say, no problem, "Who cares?" But things change, lives change, needs change, and if that means that a move is necessary or would be desirable, that will be very difficult if you are a Pattaya home owner (it is likely easier for a condo owner, because condos are fairly easy to rent to tourists, unlike homes). For many people, that mobility/flexibility in the face of an unknowable future is important and a valuable element of a home. As you say, "But if it is your castle, and you are in it for the long run, who cares?" In Pattaya, if you are a home owner, you are in it for the long run, whether you want to be or not.... Renting may have costs, but as Tolley suggested, the costs are not as big as has been suggested, and if you factor the loss you will likely experience if you need/want to sell a home in Pattaya, the costs of home ownership go up significantly. And renting does provide the ability to get out if and when you want without exposure to a capital loss, which is a very valuable aspect of the rent/own decision. But you are of course correct, neither decision is right or wrong, so long as you know what you are doing and properly factor into the decision the risks you are taking. Next time I am in the market for a home here in Thailand, I'll borrow your crystal ball if you don't mind....