Hua Hin Property Rental

[sadako]

Hi all ,

I may be interested in purchasing a house / villa / condo in the Hua Hin area early next year for the purpose of renting out . I will be spending probably from anywhere between 2,000,000 and 2,500,000 baht .

Id love to hear from you if you have a similar valued property in the area , and if you are renting it out , do you find it a successful venture ?

I mean do you find that your property is filled year round ? And what kind of monthly rent do you achieve for this value of property , considering the location is quite good .

Of course it depends on many factors , but I have been told , perhaps un-reliably , that I can get 15,000 - 20 , 000 a month in rent for a property of this type . I suspect this is only possible perhaps during 8 months of the year or so .....

Any advice , information greatly appreciated ,

Thanks ,

Sadako ......

[Thaipwriter]

Hi all ,

I may be interested in purchasing a house / villa / condo in the Hua Hin area early next year for the purpose of renting out . I will be spending probably from anywhere between 2,000,000 and 2,500,000 baht .

Id love to hear from you if you have a similar valued property in the area , and if you are renting it out , do you find it a successful venture ?

I mean do you find that your property is filled year round ? And what kind of monthly rent do you achieve for this value of  property , considering the location is quite good .

Of course it depends on many factors , but I have been told , perhaps un-reliably , that I can get 15,000 - 20 , 000 a month in rent for a property of this type . I suspect this is only possible perhaps during 8 months of the year or so .....

Any advice , information greatly appreciated , 

Thanks ,

Sadako ...... 

Hi

Ilooked into doing this a while back, your rental figures are pretty close, figure for 15-16K long term or 17-18K short term, dont forget you will need to fit air and furniture in your place. 8 months or the year is a very good estimate too. your reasearch so far is realistic.

Dont forget there has been a boom there for the last 6 months or so and you will be competing with many others for the same tennants!

at 17K a month this is a ROI of around 10% or more depending on occupancy.

well worth it if you intend to live in the property yourself and move into cheap accomodation when its let.

[appleman_thai]

Sadako,

Did you get any more info regarding this and have you actually bought in HH at this stage?

I too have looked at HH for investment but at the moment I am focussing on BKK. I reckon HH is on the up and up but my real concern is whether there will be enough tenant demand.

My 2 cents:

I reckon there will be enough demand for rentals. More and more people are making HH their home and more and more of these people dont see Thailand as a good investment opportunity (high risk - no REAL ownership) so these people WILL rent......

[sua yai]

HH's still developing quickly. There are housing developments springing up all over the place and knowing some of the people involved with the projects, they don't seem to be doing too badly.

People are still buying like mad - there was one chap who posted on another forum that he'd bought a house and had never been to Thailand. He was asking about the area.

However, there are plenty of people who are only looking to rent. I would agree with appleman's comments about the risk.

As far as a rent of 15-20,000 a month is concerned, you would have to have something really special. I pay 7,000 pmth for a two bedroom place a 15 walk out of the town centre. A friend recently moved into a 3 bedroom, detached place, with carport, 3 bathrooms etc etc. It was partly furnished, but only 8,000 a mth. The Thai owners are finally catching on to the fact that if they invest in their property and bring it up to a good Western standard, they can actually make money.

The rent you're talking about would really be for a fully furnished place very close to the beach and to be honest with you, 2-2.5 million dosn't buy very much here now.

I don't mean to put you off, but if you're prepared to get by with say 6 months rental a year, then it's still a goer. Hope that helps.

Thinking about it for a minute, most of the ex-pats I know here are renting for about 12,000 a month. Prices are going up though.

[sadako]

Well, interesting info . I have not bought yet , it will be next year sometime . I may even trial for a year and then sell back if unsuccessful and go do something else !

I have a freehold condo in BKK so I dont have to pay rent myself , only yearly maintenance and bills . Thats why i thought this may be a good option for now . If I could achieve 15 K a month , thats pretty much enough to survive on while I look for work in BKK .....which is another story !

[PeaceBlondie]

Thaipwriter suggests that a property costing at least 2,000,000 would bring in maybe 15,000 baht per month, 8 month per year, and that's 10% per year. Others suggest that no, you'd get less rent. I don't know; I'm not in that price range, maybe half that.

But that 10% a year is gross income. What are the landlord's expenses? What are the chances that the house will keep its value? Can a farang landlord really, actually, truly own house and land, legally for sure, absolutely? And how do you ever know what the value is? Even 'informed farang' sometimes pay twice the going price because their Thai wife's cousin went to undergraduate law school and thinks it's worth almost around about maybe that much.

I wouldn't buy land or housing in Thailand for 25% its retail value.

[Khun Jean]

I have an example from Samui.

My landlord has some land at the beach worth around 5 MB per rai. 4 bungalows on it.

Bungalows costs 500.000 each. Investment made 2 Mb.

The rent is total 35.000 baht for 4 bungalows.

The landlord invested 2.000.000 and gets with 100% occupancy 420.000 per year. That is a ratio of around 1:5.

Mind you this is how Thai people calculate. Westerners would add the cost of land as part of the investment.

If you or i would do that the ratio would be almost 1:17

In other words you would have to calculate rent 3x more expensive to get the same ratio, only because the land was already in the family and we have to buy it (with a company that adds expenses).

If you settle for a 1:10 ratio it still means your prices are double compared to the other.

A thorough research has to be done before you invest. Look at how many properties are for rent and compared to those what will be a realistic price you can ask. If you like the ratio, go for it. Calculate with you brain not your hart. If you like a house very much it is probably not that interesting to have as an investment. Have to remember what is in demand not what you like personally. Also if you are thinking of using the house for a while yourself, be prepared that people who rent your house don't take the same care you do.

As something to compare with. I have made calculations on cheaper Bangkok appartments for the normal working people and they will have a 1:8 to 1:10 ratio. And have an almost guaranteed 100% occupancy.

[sadako]

I have an example from Samui.

My landlord has some land at the beach worth around 5 MB per rai. 4 bungalows on it.

Bungalows costs 500.000 each. Investment made 2 Mb.

The rent is total 35.000 baht for 4 bungalows.

The landlord invested 2.000.000 and gets with 100% occupancy 420.000 per year. That is a ratio of around 1:5.

Mind you this is how Thai people calculate. Westerners would add the cost of land as part of the investment.

If you or i would do that the ratio would be almost 1:17

In other words you would have to calculate rent 3x more expensive to get the same ratio, only because the land was already in the family and we have to buy it (with a company that adds expenses).

If you settle for a 1:10 ratio it still means your prices are double compared to the other.

A thorough research has to be done before you invest. Look at how many properties are for rent and compared to those what will be a realistic price you can ask. If you like the ratio, go for it. Calculate with you brain not your hart. If you like a house very much it is probably not that interesting to have as an investment. Have to remember what is in demand not what you like personally. Also if you are thinking of using the house for a while yourself, be prepared that people who rent your house don't take the same care you do.

As something to compare with. I have made calculations on cheaper Bangkok appartments for the normal working people and they will have a 1:8 to 1:10 ratio. And have an almost guaranteed 100% occupancy.

<{POST_SNAPBACK}>

OK thanks , any recommendations as to where to buy these properties in BKK ( agents etc ) which have this almost guaranteed 100 % occupancy rate ? I was under the impression that many apartments in BKK stood empty for a large part of the year .

[Khun Jean]

In short, you are looking at appartments in the wrong segment.

[sadako]

Any chance of guiding me towards the right segment ? Havent looked into BKK possibilities really . I just have my own condo there being built for myself . Havent really thought too much of buying to rent there as yet .