Buying A Condo In Karon

[andbod]

Hi all,

I'm looking to buy a condo (freehold) in Karon (Karon Hill - The ARK).

Main purpose will be to use it for vacations 3-4 months per year and rent it out in high season (I do not expect to have more than 5-6% pa return on rental) eventually selling it in 8-10 years to exchange with a more expensive villa when I will retire.

The condo is selling off-plan (currently about 50% built) and the price seems a little bit high for Phuket standards but construction quality is quite good (I have inspected the site).

Does anyone knows the place ? Any suggestions ?

Regards,

Andrea

[Somrak]

I dod not t think, that this is still working, in any way!

(ex. for the agent and may for any few million $ objects and there agents )

..... sorry, you are may more then 10 years to late. But this i tell everybody for more then 10 years and up to now, i was may only more then 60 % right. The last 2-3 years may 80-90%.

And Thailand is may not the best place
to retire too.

Or do you like to live in a country, who gives you a visa for max. one year and you still have to "show up" at the immigration every 90 days?

And do not think, that it would get more easy.

You have time. The prices are at a near all time high and it's important, who live next to you!

Edited June 5, 2013 by Somrak

[falkan]

dont sound like a good idea, have you been driving around kata karon patong and seen how many condos that is empty?

if the condo dont sellout that means less money for maintenance, choose a brand developer like Land & House, Sansiri, Supalai they all have projects in Phuket, and even them dont sell out everytime..

the condo market for thais in phuket going really good, but the falang market is pretty mutch dead with all empty projects..

if you still want to buy, hire someone with local knowledge and dont use real estate agents..

Edited June 6, 2013 by falkan

[andbod]

Thank you very much for the advice!

I indeed saw a lot of empty condos in Kata and Patong (much more than a few years ago) and I tried to find a project with good occupancy (at least in highest season I saw a lot of russian there, but since my wife comes from the ex-soviet block this is not a big matter).

Of course the real estate agent told me that I should expect at least 15-20 days occupancy per month in high season and a 10% p.a. return on rentals but I'm fully aware that it is absolutely impossible. My best expectations are for a 5% p.a. return on rentals (including the 3-4000 USD I would save or my rental), based on my calculation it should be 5 days per month of occupancy but based on your comments I suspect that I will be already lucky if I can pay back the maintenance fees.

I'm also aware of all the problems with Visa, immigrations visits and raising cost of life but I don't plan to be in Thailand for more 3-4 months per year and before choosing Thailand I have tried Vietnam, Philippines, Cambodia, Singapore before (don't like Carribean or Africa or Hawaii too much) and each has his pros and cons.

Other choices would be hotel managed condos like Absolute or Movenpick but while it works better for renting out, I don't like living in an hotel room and investment is only a secondary goal for me.

Based on your suggestion I have decided to wait and see what happens with the Bath. If it will go down to 32-33 to USD (what I made the math it was 28) I will buy anyway and forget about the investment part otherwise I will wait for a few years more.

[johnnyk]

I wouldn't count on a 10% return. I rent out my house in a tourist town and net about 5%. There are costs to renting. Wear and tear, commissions to agencies, cleaning costs in and out, repairs and improvements etc. Furniture and amenities need to be factored in and added to the purchase price. With condos consider what happens to your investment if some or many deadbeat owners don't pay their fees (it happens a lot) and the building starts to look crappy and needed works are postponed time and again by lack of funds in the pot.

[andbod]

Well 5% net would be already very good, I was expecting 5% but not net! The 10% is the real estate agent fairy tale.

I know quite well the costs to renting (especially when you can't directly supervise them) since I already own quite a few condos in different cities around the world.

What I don't know is what happens in Thailand if owners don't pay their fees. Even in underdeveloped countries in east Europe if the owners don't pay the fees for a long time the condominium has the right to expropriate the condo. Is it not the same in Thailand ?

[johnnyk]

Well 5% net would be already very good, I was expecting 5% but not net! The 10% is the real estate agent fairy tale.

I know quite well the costs to renting (especially when you can't directly supervise them) since I already own quite a few condos in different cities around the world.

What I don't know is what happens in Thailand if owners don't pay their fees. Even in underdeveloped countries in east Europe if the owners don't pay the fees for a long time the condominium has the right to expropriate the condo. Is it not the same in Thailand ?

There are ways to push non-payers into paying their fees but it will depend on the residents' committee and chairman. Condos are pretty well always Thai-controlled because of the 51% Thai rule but Thais are mainly non-confrontational so often let things ride. It's hard to predict anything in Thailand (except the rich will get richer!).

Edited June 10, 2013 by johnnyk

[falkan]

i get 9% from my condo in phuket and i think am lucky with that..

if you know the market you can invest here..