Condo Rental Bkk-12 Month Advance Payment

[strikingsunset]

So,here i go walking into a minefield.

Advice is sought on the following.

Reading through forums it seems that discounts of "up to 50%" can be achieved by payment of 12 months rental up front.

So...

What is the way to broach this subject at which point of the negotiation ?.

Is this the norm,therefore,for example if I am looking for a 12k baht/month condo,should I start with the 20k market with a target of 12k net ?

Are the discounts the norm for up front payment or the exception ?,also are they just offered by private rentals or will the big operaters negotiate also ?.

I,ve got more questions but i think thats enough for now.........

Thanks

[lomatopo]

I confess I've never heard of pre-paying 12 months rent. That sounds like a recipe for disaster. Some places rent by the month, and then offer a discount (not 50%, maybe up to 25%) if you sign a one-year contract. Then you would pay on the first for the month each month, and put down a 1 or 2 month deposit, which you may or may not get back in full.

[strikingsunset]

I confess I've never heard of pre-paying 12 months rent. That sounds like a recipe for disaster. Some places rent by the month, and then offer a discount (not 50%, maybe up to 25%) if you sign a one-year contract. Then you would pay on the first for the month each month, and put down a 1 or 2 month deposit, which you may or may not get back in full.

ah ha........thanks,I am listening and learning............OP

[CharlieH]

Do as the Thais ALWAYS do, and thats never part with more than you aboslutely have to. Paying more than 1-2 months upfront is definately a bad idea. Deposits etc are seldom returned 100% as something will inevitably be wrong or changed or damaged etc when its time to leave.They are experts at extracting cash but equally good at making sure they dont part with any when its time to give back.

Personally I wouldnt sign for anything more than 6 months, they can and do often change the rules or move the goal posts, what seems like a nice place now could turn into a building site next month, be renovated, altered or just sold to someone else.

Edited August 12, 2011 by CharlieH

[mauiguy90]

It is possible to negotiate a discount by doing an advance payment, however, right now the real estate rental market is quite soft. You can negotiate a price without giving such a large amount of money. In general, I'd agree with the other posters that advise against such a practice. If you demonstrate that you are a likable, responsible type of tenant while you are talking with the owner, they will be more likely to give you a discount. If you come with a wheeler dealer, take it or leave it attitude, most owners "will leave it."

I used to disagree with the two month deposit policy that most owners, thai or otherwise generally follow. However, there are two major factors which justify the two month deposit:

1) The owners have no idea who you are. Most tenants come with no references, many have no jobs when they are seeking a rental and lots of renters are guys just looking to have a good time, then intend to skip out on their contract as soon as they have had their fill. Its lots easier to do this with a one month deposit, isn't it?

If a tenant ruins the contents of such a condo in your home country, you can hunt them down and sue them. In Thailand, they just run off and are never heard from again.

2) How much would you pay for a rental in your home country? The deposit is used to cover the contents of the condominium. Many units that rent for 15k and above have an LCD tv and many other items which cost the same or more than in Western countries. The owners have to make sure that the contents of their property are properly insured. Like I noted above, some guys do skip out after ruining their rentals. Who's supposed to pay for the damage when the place rents for $300 to $500 a month and the damages double or triple that amount? All a tenant has to do is be late for their rent and then walk out with the LCD tv.

When you start renting out your own place, you will find that out there are lots of undesirable people seeking rentals. They all look the same, generally smell the same but put a beer in the hands of the wrong guy and they don't all act the same. There are of course some really lousy landlords who never intend to return deposits. However, I've had the experience where one of my tenants stole everything including the bedsheets, the blankets and various other household items, plus they left the place filthy with dirt all over the furniture. Furthermore, he always paid his rent late, sometimes a month late and at times, two months late. Fortunately, I had a two month deposit which covered most of those costs. FYI The tenant was also Japanese. As I said before, you never know who will be a good tenant!

[janetdoe]

I'm working in Jakarta on a two year contract and paying in advance here is the norm. My landlord wanted me to pay up front for the whole two years!!!

I negotiated a 12 month contract, without discount, but had to pay in advance. When I mentioned paying monthly her English skills mysteriously started to fail her...

Just think yourself lucky this crazy situation isn't the norm in Thailand too. Strange thing is the service charge on the condo I own in BKK is paid yearly in advance, but here service charge is paid monthly!

[dddave]

I've known people who have saved one months rent or sometimes 10% annual by paying up front but I've never heard of anything approaching 50%.

Pre-pay is frequently negotiated when one ex-pat is renting to another ex-pat. If the owner is returning to his home country for a long term, paying up front can eliminate the complexities and cost of monthly rent payments being transferred overseas.

[Torgo]

If you're willing to spend a few days looking at different condos you should be able to shave 25-40% off the listed rental price anyway. Look for listings that have sat unused for several months and you'll find that the owners are generally much more willing to drop the price if you can move in ASAP.

[dundee007]

never pay more than 2 months rent in advance......you might not like it later and there can be several negative issues in condos that may come up later.

[strikingsunset]

never pay more than 2 months rent in advance......you might not like it later and there can be several negative issues in condos that may come up later.

Thanks to all for the advice,for sure I will not be paying more than 2 months in advance after your guidance.

Regards,

OP

Edited August 14, 2011 by strikingsunset

[AdamRich]

I confess I've never heard of pre-paying 12 months rent. That sounds like a recipe for disaster.

I do it in Pattaya. It just makes it easier for me seeing that I am not constantly in Thailand. Then too it is only 4500/month. I do not get any type of discount. At the place I was going to rent from before it was 5000/month and upon my inquiry the lady said she would give me a 5% discount if I paid 1 year in advance. However this lady and her farang husband were really in need. She said they owed the bank 5 million baht (Seems pretty low. Maybe she meant or said 50 million) on the 3 year old building but it was only 1/3 full.