best condo to buy to rent ? where for best return. 3.5 budget.

[kranuan]

its only a thought at minute, 3.5 - 4m in thai bank wasting away, we could get 3% on it leaving it with kasikorn but then we are thinking of a condo or house to rent.

any advise ? if so please provide pictures, links, details please.

thanks

[JaiLai]

PM sent.

[kranuan]

3.5 budget maybe stretch to 4 , doing some homework on this first . bang saray ? bangkok ? ban chang ? rayong ?

definately not jomtien !!!!!!

Edited April 28, 2014 by kranuan

[kurnell]

PM sent.

Speak up. There are others here with money to spend

[Gsxrnz]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Edited April 28, 2014 by Gsxrnz

[kranuan]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

very very good solid advice, i like replies like this. common sense . thankyou

[kurnell]

Interesting. My msz has a condo that she bought for 1.70m and she is getting 13k per month

[spambot]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Good insight - I was looking at investing in condo in Rayong, but I could not see where the earning were coming from that would justify something significantly higher than a Bank TD - FYI Currently LH Bank is paying 2.7% without the need for TD i.e instant access.

This should also be a safer bet, but nothing is without risk - I was told by a few banks that the Gov guarantee (on Bank failure) of 50mill Baht will be replaced and dropped to 1million Baht - But non of the banks I speak to have any details when this will occur....Any knowledge here?

[Gsxrnz]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Good insight - I was looking at investing in condo in Rayong, but I could not see where the earning were coming from that would justify something significantly higher than a Bank TD - FYI Currently LH Bank is paying 2.7% without the need for TD i.e instant access.

This should also be a safer bet, but nothing is without risk - I was told by a few banks that the Gov guarantee (on Bank failure) of 50mill Baht will be replaced and dropped to 1million Baht - But non of the banks I speak to have any details when this will occur....Any knowledge here?

The guarantee is 50M to Aug 2015, 25M to Aug 2016, and then 1M thereafter.

[trogers]

Interesting. My msz has a condo that she bought for 1.70m and she is getting 13k per month

Probably bought a few years ago and present market value of the condo is around Bt2m.

[lomatopo]

There are other potentially safer and easier (dividend yield, liquidity) ways to invest in the RE market without becoming a landlord: the various housing development companies.

http://kinvestmentportal.kasikornsecurities.com/fileadmin/pdf/English/1/8/21/2014/140422_Sector_Report_Thai_residential_property_E96561.pdf

http://kinvestmentportal.kasikornsecurities.com/fileadmin/pdf/English/1/7/714/2014/140227_Company_Report_QH_E20045.pdf

http://kinvestmentportal.kasikornsecurities.com/fileadmin/pdf/English/1/7/852/2014/140303_Company_Report_AP_E66672.pdf

Edited April 29, 2014 by lomatopo

[Suradit69]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Good insight - I was looking at investing in condo in Rayong, but I could not see where the earning were coming from that would justify something significantly higher than a Bank TD - FYI Currently LH Bank is paying 2.7% without the need for TD i.e instant access.

This should also be a safer bet, but nothing is without risk - I was told by a few banks that the Gov guarantee (on Bank failure) of 50mill Baht will be replaced and dropped to 1million Baht - But non of the banks I speak to have any details when this will occur....Any knowledge here?

From the Deposit Protection Agency (click on thumbnail)

[spambot]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Good insight - I was looking at investing in condo in Rayong, but I could not see where the earning were coming from that would justify something significantly higher than a Bank TD - FYI Currently LH Bank is paying 2.7% without the need for TD i.e instant access.

This should also be a safer bet, but nothing is without risk - I was told by a few banks that the Gov guarantee (on Bank failure) of 50mill Baht will be replaced and dropped to 1million Baht - But non of the banks I speak to have any details when this will occur....Any knowledge here?

From the Deposit Protection Agency (click on thumbnail)

Brilliant - So it straight from the horses mouth (so to speak)!

[lomatopo]

Based on 3.5M here's the numbers - gross before expenses

The monthly condo maintenance fees may become a more significant factor at these lower rent thresholds, assuming you choose to pay it.

Make sure you run these numbers factoring in not only the maintenance fee - maybe use some average per sq. m./month, but also (however minimal) monthly electric, water, cable TV, internet for those periods when the property might be unoccupied. Some of these expenses (cable TV, internet) are recurring/fixed, and it can be challenging to rent a property without these.

[PattayaPhom]

Have 2.3Mil with sitting tenant paying 18,000 per month,maintenance charges per annum 12,400. top floor one bed seaviews 64 sqm fully furnished 2 balconies, parking, 2 pools gym and 200 yards from beach...BARGAIN

[lomatopo]

maintenance charges per annum 12,400

That maintenance fee, ~ 16.15 baht/m2 is enviably low. Hardly seems like enough for chlorine for the two pools.

Was this a recent purchase?

[KittenKong]

Have 2.3Mil with sitting tenant paying 18,000 per month,maintenance charges per annum 12,400. top floor one bed seaviews 64 sqm fully furnished 2 balconies, parking, 2 pools gym and 200 yards from beach...BARGAIN

I'm surprised that anyone would be stupid enough to pay such a high rent for a unit that is worth so little.

[KittenKong]

maintenance charges per annum 12,400

That maintenance fee, ~ 16.15 baht/m2 is enviably low. Hardly seems like enough for chlorine for the two pools.

I pay about the same price per sqm.

[PattayaPhom]

Have 2.3Mil with sitting tenant paying 18,000 per month,maintenance charges per annum 12,400. top floor one bed seaviews 64 sqm fully furnished 2 balconies, parking, 2 pools gym and 200 yards from beach...BARGAIN

I'm surprised that anyone would be stupid enough to pay such a high rent for a unit that is worth so little.

Maybe the rent isnt high, just the price is low as a quick sale wanted from a committed buyer

[PattayaPhom]

maintenance charges per annum 12,400

That maintenance fee, ~ 16.15 baht/m2 is enviably low. Hardly seems like enough for chlorine for the two pools.

Was this a recent purchase?

Because all residents pay their fees and no no silly gimmics like sailboats or wave machines with plastice beaches and caves its sufficient to cover costs.

[spambot]

kranuan

How are you getting 3.0% from Kasikorn?

http://www.kasikornbank.com/EN/RatesAndFees/Deposit/Pages/Deposit.aspx

I can see 2.25% for a timescale of 8 months

There is 24-Month Super Taweesub Deposits but is not exactly 3.0% and is a rather long term TD at 24 month.

Am I missing the opportunity you are seeing somewhere else?

[falkan]

1,2m 29sqm fully furnished renting out for 9000baht a month 100% occupancy since completed 2 years ago..

location location.. =)

[kurnell]

Interesting. My msz has a condo that she bought for 1.70m and she is getting 13k per month

Probably bought a few years ago and present market value of the condo is around Bt2m.

Condo was completed this year

[KittenKong]

I'm surprised that anyone would be stupid enough to pay such a high rent for a unit that is worth so little.

Maybe the rent isnt high, just the price is low as a quick sale wanted from a committed buyer

Ah. That would be agent-speak for "this unit is for sale at a fairly sensible price, as opposed to all the fantasy asking prices one sees everywhere".

Even so, I'm still surprised that anyone would pay such a high rent for it.

[Rowdy100]

My condo in Sukhumvit cost approx. 60,000 baht per square m.. It's 2 br, 2 bath, 65 sqm. Paid 3.9 mill baht (fully furnished). 9 Floor building, well maintained, top-floor condo, city views from living area and both b'rs.., lots of natural light during day...Pool and functional gym, 6 mins walk to BTS, walking distance to golf driving range. 7/11 downstairs, BIG C close by, plenty of quailty / cheap food options close by.

Bought it 4 yrs ago, lived / living in it. Love it. Have rented it out for 30,000 baht per month for 12 months and had no problems there at all. For the (foreign) tenant, I covered / paid 500 baht month for unlimited internet, about 3,000 annual for Happy Home Cable TV... 27,000 baht nnual for condo management fees, about 1500 baht month for electricity (3 a/c's on all day during hot season) - virtually zero for electricity during cooler months, 200 baht month for water.

Even if there is no capital growth or I can't / don't want to sell it.., I'm still able to get better than 8 % annual ROI should I choose that as an option..

Yes, there are horror stories, but if you look around, pick the right place (location & building maintenance) in a nice / convenient area then you can do OK. If nothing else, you (or your family) will always have a nice, cheap to live and easy place to stay. :-)

[marioc]

What return do you want? Based on 3.5M here's the numbers - gross before expenses and assuming 100% occupancy.

Monthly Rent Annual Rent % p.a. Return

10,000 120,000 3.42%

12,000 144,000 4.11%

15,000 180,000 5.14%

20,000 240,000 6.86%

30,000 360,000 10.29%

As you're unlikely to get 30k rent on a 3.5M condo (more like 12-15,000) and it would be unlikely to maintain 100% occupancy, the best return you could probably expect on average after allowing for reduced occupancy and expenses will be circa 4%.

Plus you have the drama of trying to release your capital eventually by selling the condo, and of course it will be a seller's market for years to come (joke).

I know 4 people that have done this and all regretted it with a passion. One chap owns three condos and is virtually cashflow destitute because he can't sell them and can't get regular tenants. Russian tenants trashed one of them last year and he can't afford to get it repaired. Another chap is getting 25,000 baht a month on a shop building he paid 17M for and can't give it away at 12M. His return is a massive 1.76%. p.a.

A return of arguably 4% is hardly worth the risk compared to a bank deposit, unless you want to hang your hat on capital gains and appreciation of the Baht over the next 3 to 5 years. I wouldn't, but then I'm naturally averse to residential property for investment purposes.

Three or four mill is a decent sum - consider the sharemarket balanced with TD's for a better return, not much more risk if done wisely, and certainly much more liquid.

EDIT: I should balance this with another aquaintance who I know very casually, but seems believable. He claims to have 8 condos and works them like a business. He's constantly networking friends overseas to be casual holiday tenants in some of them at inflated rents and also runs a website with online bookings/reservations etc. He essantially runs it like a business and is always on the hunt for tenants - to the point that he can become a nuisance to his resident friends/aquaintances. He claims to make over 1.5M a year, but I have no idea what the overall value of the condos are. If I assumed total value at say 18M, his return would be 8.33% p.a.

Good insight - I was looking at investing in condo in Rayong, but I could not see where the earning were coming from that would justify something significantly higher than a Bank TD - FYI Currently LH Bank is paying 2.7% without the need for TD i.e instant access.

This should also be a safer bet, but nothing is without risk - I was told by a few banks that the Gov guarantee (on Bank failure) of 50mill Baht will be replaced and dropped to 1million Baht - But non of the banks I speak to have any details when this will occur....Any knowledge here?

From the Deposit Protection Agency (click on thumbnail)

Thank you for the info...well appreciated.

[ozyjon]

In this game there are winners and losers,, it's a game and like the poster Gsxrnz pointed out, many people don't do their sums or don't know how to do them, property needs upkeep and maintenance and also the tenants can be a pain by trashing, not paying, being dirty and on it goes,, residential property is the type of property you hear the most about because it's the banks that make the most money out of the punters, but still they keep on buying, i own properties around the world but i would never buy in Thailand, do your homework well, just because Joe Schmo down the road claims to own many properties and make tons of money,, just ask yourself how much sleep they are loosing over their venture,, do your homework.

[crazykopite]

I know a guy who buys cars /jeeps never pays more 100,000 last month he purchased a Suzuki jeep guy was desperate to sell wanted 150,000 offered him cash there and then of 100,000 did the deal had it valeted and flipped it for 170,0 000 all within a three week period . He does it on a regular basis !! The ones he does not sell he rents out until he finds a buyer

[Cosmo88]

Lots of apples and oranges in this discussion...

There's quite a difference between a crappy non-beach-front condo development in over-supplied Pattaya and a well-located condo in Bangkok developed by an SET listed property firm.

[RickvanHeijningen]

Try before you buy.https://www.facebook.com/groups/1411744682370576/ try before you buy

Move into your new home straightaway and rent it, giving you time to decide to buy.

Would you like a new home, but you’re not sure it’s the right time? Or maybe saving for a deposit whilst renting is proving too difficult. Getting a mortgage is not always easy, even at the best of times.

Well, here’s a great idea that may be just up your street called 'Try before you buy'. If you choose to buy, you get up to your first 12 months’ rent towards your deposit.

Win, win, win

You get the home you want – no waiting, no messing around, no fuss. Plus you get time to find the mortgage that’s right for you while saving for your deposit. You get the opportunity to live in your new home, to see if it really does live up to your expectations. Not just the house itself, but the location, everything.

'Try before you buy' is such a good opportunity for lots of people who are unsure whether to buy right now. And for those of you whose temporary and financial circumstances are making it extra difficult, we’re sure this innovative scheme will be a real help. In the meantime, you can sit back and enjoy your new home safe in the knowledge that your rent isn’t being wasted as it can go towards your deposit.

How it works

You sign up to a rental agreement (it’s called an assured shorthold tenancy) which is simply the legal contract between you and us. The level of rent will be set at the current market value, so it’s a completely reasonable rent – what you would pay anyway.

When you move in, all you’ll need is the first month’s rent plus another month’s rent as a deposit. When you sign up to your rental agreement you also secure the option to purchase at an agreed price. Your rent can only be used towards a deposit and is non refundable. And that’s it

Gr, Rick van Heijningen.