Investing In Condos: Your Opinion

[mike111]

I consider buying condos as an investment, for the purpose of renting them out long term. It seems that with a monthly rent of 10K-15K per condo, having a few condos could allow me to live in reasonable comfort in Thailand w/o having to work (obtaining a visa or work permit is another issue).

Any opinions? any members which have followed this route and can share their insights?

TIA

[PattayaPhom]

if you do, make sure you dont buy anything under 35sqm or else you will struggle to find tenants...many new developments are 25-28sqm and believe me, prospective tenants take one look and walk away, this is going to be a major problem for a lot of people that have bought these shoeboxes in the past few years. Make sure they are in a good location, View Talay 1 and 2 are good but you need to consider the outlay and your return?....you may find other investments offer a better return. Capitol appreciation although there, is minimal, dont forget to factor in maitenance costs, maybe agents fees and also you should work on the assumption of 10 months rent pa allowing for overlaps of tenants.

[strollling]

Buy in a proper country, not in Thailand.

Edited May 9, 2012 by strollling

[mike111]

Thanks.

Fully agree that those 28sqm or less condos are a pain to rent.

Strolling: what's wrong with property investment in Thailand? I understand a foreigner can't own land/house, but no such issues with owning a condo.

[plopmeister]

I have 2 in Nova Mirage in Naklua and they have constantly provided me with 30,000 Baht a month "tea money" for a few years now. It is an excellent complex and well run so long term return customers are in good supply...but for how long??

I am a great believer in not putting all your eggs in one basket. Don't use all your spare cash on buying condos. I have my 2 condos, my mushroom farm, I am taking up part time teaching next month and we are looking at acting as an employment agency for local factories..and of course my normal proffessional life as a contractor..

If you live near a university town look at buying student accommodation and renting it out..

[mike111]

I was thinking about the student accommodation too, but can you own these small apartments on your name, as with condos, without going down the thai company route?

[plopmeister]

I was thinking about the student accommodation too, but can you own these small apartments on your name, as with condos, without going down the thai company route?

Nope. My wife bought some in her name.So a company name would do it for you...Well worth it if you buy enough...Guaranteed income if you buy enough and get somebody to manage it..

[strollling]

Strolling: what's wrong with property investment in Thailand? I understand a foreigner can't own land/house, but no such issues with owning a condo.

The country is far too unstable in the long term.

Future visa laws?

When the inevitable/unspeakable happens?

Long-term social and political instability.

As the Thais say, 'Thailand is for the Thais'... Rent, enjoy your life here, just don't get overly involved or start investing what you'll cry over if you lose.

And a foreigner can own a house. Just not the land it's built on unless they 'invest' 40 million baht.

[mike111]

I agree Thailand isn't a safe haven, but most places aren't too.

Spain and Ireland were great for real estate only a few years ago, where are they now?. Ditto for the US.

The difficulty in owning land/house is an issue, that's why I'm exploring the condos venue. Nothing is fixed yet, just thinking out loud.

[PattayaPhom]

Strolling: what's wrong with property investment in Thailand? I understand a foreigner can't own land/house, but no such issues with owning a condo.

The country is far too unstable in the long term.

Future visa laws?

When the inevitable/unspeakable happens?

Long-term social and political instability.

As the Thais say, 'Thailand is for the Thais'... Rent, enjoy your life here, just don't get overly involved or start investing what you'll cry over if you lose.

And a foreigner can own a house. Just not the land it's built on unless they 'invest' 40 million baht.

I dont know where you are from but just look at the instability in Europe and the USA..forget Central and South America, Oz is too expensive..do you ever look at current affairs in SE Asia..what about 2015 and ASEAN....Thailand and SE Asia are the powerhouse of the 21st century...get with the programme slick, the West is done for

Edited May 9, 2012 by PattayaPhom

[PattayaPhom]

I have 2 in Nova Mirage in Naklua and they have constantly provided me with 30,000 Baht a month "tea money" for a few years now. It is an excellent complex and well run so long term return customers are in good supply...but for how long??

I am a great believer in not putting all your eggs in one basket. Don't use all your spare cash on buying condos. I have my 2 condos, my mushroom farm, I am taking up part time teaching next month and we are looking at acting as an employment agency for local factories..and of course my normal proffessional life as a contractor..

If you live near a university town look at buying student accommodation and renting it out..

Nova is very popular and well looked after...wouldnt worry too much, its now a large Russian area with Tesco Express a few hundred yards away. Thai rooms are a great idea and as it will be a legite trading company, company ownership wont be a problem if you get an accountant and make sure your books are upto date.

[mike111]

By "Thai rooms" u mean condos or those cheap rooms for uni students?

[PattayaPhom]

By "Thai rooms" u mean condos or those cheap rooms for uni students?

Cheap Thai rooms rent from 2k upwards....to make sure you benefit fom a better return, source the land and build your selfe. I have 18 rooms 9 down and 9 upstairs..downstairs rents for 4k with air and hot shower upstairs 3k for fan..depends where you are, a uni town up north wont get as much as close to BKK.where are you based?...just to give you an idea, my initial investment was recoupoed in just under 4 years although I was lucky in finding a cheap plot and had my own builders.

[mike111]

did u buy the land through a company or are u leasing it?.

[PattayaPhom]

did u buy the land through a company or are u leasing it?.

did u buy the land through a company or are u leasing it?.

Neither, its in my childs name.....If the chance came again for a plot in a good location I would probaly go through company ownership.

[strollling]

.get with the programme slick, the West is done for

Who mentioned the West?

[23962323]

I have 2 in Nova Mirage in Naklua and they have constantly provided me with 30,000 Baht a month "tea money" for a few years now. It is an excellent complex and well run so long term return customers are in good supply...but for how long??

I am a great believer in not putting all your eggs in one basket. Don't use all your spare cash on buying condos. I have my 2 condos, my mushroom farm, I am taking up part time teaching next month and we are looking at acting as an employment agency for local factories..and of course my normal proffessional life as a contractor..

If you live near a university town look at buying student accommodation and renting it out..

Nova is very popular and well looked after...wouldnt worry too much, its now a large Russian area with Tesco Express a few hundred yards away. Thai rooms are a great idea and as it will be a legite trading company, company ownership wont be a problem if you get an accountant and make sure your books are upto date.

Think I would ask at land office about company route.

[london]

This topic has been discussed time and time again.

Mike111, the real questions are (not for publication, but for you to work out):

1) what amount of your nett wealth do you want to tie up in Thailand?

2) what would happen IF the properties aren't rented for a period of time?

3) if the worst possible scenario happened and you lost everything in Thailand, what difference would it make to your lifestyle?

4) do you know, not as a tourist but someone who lives there, Thailand?

5) have you previous property investment experience ?

I have invested in Thailand for over 15 years now and, providing you don't put all your eggs in one basket, would advise anyone to do it IF THEY KNOW WHAT THEY ARE DOING.

There have been doom and gloom people here since day 1. They are happy renting and thats fine.

Depending on your expectations, I would budget for a 6% return. If you get better, well done. If you don't, well, you may do better with your money elsewhere.

Lastly, where are you going to live? In a rented apartment or are you going to use one of the ones you buy as your residence?

[mike111]

Thanks london.

6%p.a. isn't that attractive, I'm getting that with my risk-free term deposit already.

Is it realistic to expect appreciation of the property? say buy and hold the property for 5-10 years, and then sell.

I'm somwhat put off by the strict regulations on foreigner house/land ownership. The company route is there, but seems convoluted. If I want full owendership, then, as I understand, it's only condos.

what have u invested in, if I may ask? condos? houses? land?

[Heng]

I have nearly 2 dozen units of the large shoe box / 1 br variety. I agree that this size is harder to lease out than the more spacious variety, but I prefer similar type assets (to organize mentally) and the handful of units I started with were what I could afford at the time. All occupied without agency help. Just constant advertising on pantip, sanook, etc. Have stuck with major developers (my okay short list are: Land and House, Ananda, Preecha, LPN, and AP), and cash only purchases, no mortgages. It's a decent return and mostly hands free condo management (as the actual condo management takes care of a lot of the issues I have to deal with more actively myself with my homes and buildings.... re-sealing roofs, awnings, cracked walls, re-painting, plumbling and electrical issues, etc.). Nice to have condos in the portfolio, but as a local I would never go condo only as there's always that lingering 'high rise shelf life issue' that will have to be dealt with, this generation or the next.

p.s. the advice in there is to stick with established developers that actually know that condo management is an important thing that must be handled in perpetuity... and of course so you don't get burnt with an off plan buy that doesn't get built. Also that if you can swing it, go 100% equity so there isn't much downward pressure (other than condo management fees) for you to find tenants.

Edited May 15, 2012 by Heng

[farang000999]

I am getting 10% return after taxes/insurance on my USA property. the usa banks have tons of real estate "locked up" and this has driven up rents. I am very bullish on US property long term. For one, social security is in trouble and the government may very well ease immigration which means more people and demand long term. You can also look at the cost to build vs cost to buy and cost to build is substantially higher. Eventually the glut will be dealt with and prices will have to rise to meet demand. The USD will eventually be devalued and China will ease it's position as an export giant and start consuming more and the US economy and exports will pick up quite a bit. I personally feel that devaluation of the USD is not going to be as bad as others anticipate as the US still has massive means of production and the leader in technology, unlike say, Argentina or Ireland or Greece.

Edited May 15, 2012 by farang000999

[craigt3365]

I am getting 10% return after taxes/insurance on my USA property. the usa banks have tons of real estate "locked up" and this has driven up rents. I am very bullish on US property long term. For one, social security is in trouble and the government may very well ease immigration which means more people and demand long term. You can also look at the cost to build vs cost to buy and cost to build is substantially higher. Eventually the glut will be dealt with and prices will have to rise to meet demand. The USD will eventually be devalued and China will ease it's position as an export giant and start consuming more and the US economy and exports will pick up quite a bit. I personally feel that devaluation of the USD is not going to be as bad as others anticipate as the US still has massive means of production and the leader in technology, unlike say, Argentina or Ireland or Greece.

Agreed. Question: how do you manage your rental? Are you in the US or live here? If here, who takes care of the property for you? Just curious...

[mikelohan109]

I am getting 10% return after taxes/insurance on my USA property. the usa banks have tons of real estate "locked up" and this has driven up rents. I am very bullish on US property long term. For one, social security is in trouble and the government may very well ease immigration which means more people and demand long term. You can also look at the cost to build vs cost to buy and cost to build is substantially higher. Eventually the glut will be dealt with and prices will have to rise to meet demand. The USD will eventually be devalued and China will ease it's position as an export giant and start consuming more and the US economy and exports will pick up quite a bit. I personally feel that devaluation of the USD is not going to be as bad as others anticipate as the US still has massive means of production and the leader in technology, unlike say, Argentina or Ireland or Greece.

I am getting 10% return after taxes/insurance on my USA property. the usa banks have tons of real estate "locked up" and this has driven up rents. I am very bullish on US property long term. For one, social security is in trouble and the government may very well ease immigration which means more people and demand long term. You can also look at the cost to build vs cost to buy and cost to build is substantially higher. Eventually the glut will be dealt with and prices will have to rise to meet demand. The USD will eventually be devalued and China will ease it's position as an export giant and start consuming more and the US economy and exports will pick up quite a bit. I personally feel that devaluation of the USD is not going to be as bad as others anticipate as the US still has massive means of production and the leader in technology, unlike say, Argentina or Ireland or Greece.

I agree of this one. So true US still has massive means of production and the leader in technology and that was the advantage

[scotinsiam]

Buy in a proper country, not in Thailand.

Where would you suggest? Greece? Spain? Italy? UK? USA?

[scotinsiam]

Strolling: what's wrong with property investment in Thailand? I understand a foreigner can't own land/house, but no such issues with owning a condo.

The country is far too unstable in the long term.

Future visa laws?

When the inevitable/unspeakable happens?

Long-term social and political instability.

As the Thais say, 'Thailand is for the Thais'... Rent, enjoy your life here, just don't get overly involved or start investing what you'll cry over if you lose.

And a foreigner can own a house. Just not the land it's built on unless they 'invest' 40 million baht.

Yes and the West is solid as a rock - I would much rather invest some money in LOS than in the UK / USA or god forbid the EU - I do agree however with your comments regarding land ownership and would not recommend buying a house.

[meand]

I don't believe in much of the doom and gloom. It's not that I don't believe, just think it can happen in pretty much any country. As others have said, investing is taking a chance based off of knowledge you have. I just personally don't see Thailand falling to pieces anytime soon or even in the distant future -- the actual property you buy falling to pieces in the long term is a different matter of course. Research on the major developers is a must.

Edited May 20, 2012 by meand

[london]

Mike111, apologies for the late reply...travelling.

Yes, the 6% is pretty much it from my experience and if you can get that, or better, from a term deposit, then why would you bother?

Re Appreciation: yes, its there, but to predict how much in 10 years is difficult. My experience is that it is a conservative appreciation, possibly 5%pa....perhaps more in other developments. However, that said, I am very happy with a 5% pa appreciation and a 6% yield. It is an effective 11%pa.

I can't legally buy houses here, so I don't. Not interested in something that is not simple.

I ONLY invest in Condos in the Thai RE market for the above reason. If that ever changed, then I would possibly look at houses.

[yoshiwara]

I agree Thailand isn't a safe haven, but most places aren't too.

Spain and Ireland were great for real estate only a few years ago, where are they now?. Ditto for the US.

The difficulty in owning land/house is an issue, that's why I'm exploring the condos venue. Nothing is fixed yet, just thinking out loud.

Hong Kong.

[yoshiwara]

Strolling: what's wrong with property investment in Thailand? I understand a foreigner can't own land/house, but no such issues with owning a condo.

The country is far too unstable in the long term.

Future visa laws?

When the inevitable/unspeakable happens?

Long-term social and political instability.

As the Thais say, 'Thailand is for the Thais'... Rent, enjoy your life here, just don't get overly involved or start investing what you'll cry over if you lose.

And a foreigner can own a house. Just not the land it's built on unless they 'invest' 40 million baht.

I dont know where you are from but just look at the instability in Europe and the USA..forget Central and South America, Oz is too expensive..do you ever look at current affairs in SE Asia..what about 2015 and ASEAN....Thailand and SE Asia are the powerhouse of the 21st century...get with the programme slick, the West is done for

Parts of London Zone 1 are fine.

Edited May 28, 2012 by yoshiwara

[london]

Hong Kong ? London ?

Having experience in both markets, there is a slight cost differential between them and Thai property.

Invest in the East, PattayaPhom is 100% on the money.