Does It Make Sense To Buy A House Here

[bowerboy]

I am thinking of buying a house or Condo in Thailand but it just doesnt seem to make any financial sense to do so...am I missing something or am I seeing this right. I will use my own situation as the example (lets please put ownership issues aside to focus only on the numbers).

I am looking at a house for 6,000,000THB that would cost me 35,000THB per month if I wanted to rent it. Therefore that is 15 years of rent. If I bought it then on average it would probably be another 150,000 per year in maintenance and corporate body fees. So basically with all fees and upkeep added in I could rent the place (or similar) for 20 years for the cost of buying it.

Now the village it is in is 6 or 7 years old and is already showing serious signs of decay and neglect. 20 years from now I am wondering if the village will even be liveable. This particular house is for sale for the same price now as when it as finished 3 years ago.

Given the poor maintenance here and the poor quality of buildings (and the fact that in 20 years I will be 64 anyway) is there really any point buying a place here? In my view that house would be almost worthless 20 years from now. So while the rent is dead money at the same time buying it would be nearly dead money too when you think what condition the house and village will be in 20 years from now.

Surely if I did it by mortgage then it would possibly be an even worse situation as I would be paying double that amount just in interest.

In my thinking the same applies to condos, even in Bangkok. I was looking at a condo in Thonglor the other day (Waterford) that the lady was selling for basically the same price she paid for it just before the 1997 financial crisis.

Is it worth buying a property here based on the numbers alone (and not even factoring in things like potential for noise and no option to move etc).

Especially now that some Bangkok prices are getting very high indeed.

Any thoughts or ideas are welcome as I feel I must be missing something.

[EBlair48]

No, people are buried in properties and you have no control over what is built next to you. Rent and rent cheap

[MJP]

Rent.

[Loptr]

Rent... One thing you failed to consider is if you invest the 6,000,000 baht you would be using for the purchase, you will have a return on that investment to offset your rental costs, whereas if you purchase it's sunk funds with zero return...

[Boyce]

it will never be yours 100%, rent is the way to go .

[jacky54]

People who say rent are often ones who cannot afford to buy, but wish they could.

[bowerboy]

Yeah good point...5% of 6,000,000THB would be 25,000THB alone.

[smokie36]

Offer 4 million

[Loptr]

People who say rent are often ones who cannot afford to buy, but wish they could.

Or perhaps we are the ones with some sense to not invest capital in a country where you have zero rights and can we deported at any time, or have you missed the recent visa crackdown?

[sirineou]

Buying a house might not make any sense if money was the only consideration.

If money is your only confederation then simply rent.

But if you want a home , a place to set roots, and do with as you please, then buy or build your own.

Would you invest a lot in a garden in a rental? would you invest in remodeling to customize it to your liking. Will there be anything of you left after you are gone for the once you love.

[beachproperty]

Easy to buy property in Thailand .....Hard (very hard) to sell....That being said ...Personally I have made money (or I should say my wife has ...which she has given me anyway) , but it wasn't easy and took awhile.

benefit of owning a home is it's yours (I wouldn't buy a condo,,,,corporate body fees, politics and maintenience money gone for nothing!)

Also I wouldn't buy the home your speaking of as it sounds too expensive!

Look for land and build your dream home ....can be done for under the 6,000,000 you're looking to spend (much cheaper!) but as pointed out earlier it's money gone! if you need it ...RENT!

good luck

[Soutpeel]

OP this seems like a great opportunity to get onto the Thai property ladder, dont listen to the nay sayers, go for it buy it

Edited July 13, 2014 by Soutpeel

[bowerboy]

Thanks for this....it is a different ball game here for sure.

I guess the point is this: If I bought a home in UK then the price could go up or down in 20 years BUT one thing is for sure...20 years from now you could live in a house that is the same thing in 20 years as the day you bought it....indeed your grandchildren could live in it it 60 years from now without issue.....in contrast can you imagine a house or condo here in 20 years or worse still in 60 years time? No way if I bought a house or condo here would it be liveable 60 years from now.

I think that is the fundamental issue I am facing in my mind.

[Costas2008]

OP, buying a house, is not an investment.

It is a great pleasure, to own your own property, than rent and live in somebody else's house.

This is your castle, this is your own space, this is the place you will get more and more attached as time goes by.

Your calculations about maintenance are wrong.

I build my house 5 years ago and the only things I've spend money for is for new bum guns, and a new electric pump for 4,000Baht.

Don't listen to others, follow your heart and brain and do the right thing by buying a house.

PS. If you are married, think also for your wife, that when you go she will have somewhere to live and remember of you.

[thehelmsman]

Strictly from a finanicial point of view then buying makes little sense. If you've got children in Thailand, then why not. 6 mil isn't needed for a nice house, and you can still have the local villagers kneeling before you in the morning.

[MJP]

People who say rent are often ones who cannot afford to buy, but wish they could.

Got two, but the kids own them. If you don't have children in Thailand . . . then rent.

[bowerboy]

Hi Costas...i guess that is my concern...with the quality of the building and the uncertainty of surrounding land (wherever you live here) there will be nothing to remember me by! I just cant see it lasting or lasting in a way that will be desirable 20 or 30 years from now....more like "wow, can you belive we actually used to live there!"

Having said that I would of course LOVE one of those compound type houses you see all round the small sub sois of Sukhumvit...i can definitely see the romance in owning something like that but then you are talking more like 30million up!

[CharlieH]

Generally, the biggest single living expense is the roof over your head. If you can buy it out right, that cost no longer exists. If you rent, yes you can walk away etc but there is a good chance that rent will continue to rise.

Its never yours and could be taken away at anytime (within reason).

If you have enough capital behind you to meet that rent, year on year, irrespective of illness and circumstance etc then rent may be the way to go.

If the financial future is not quite so certain and you truly intend to live your life here, buy and its done, nothing else to think about accept usual running cost and food. That, for some is a better and more comforting long term post retirement prospect.

[ignis]

Maybe look at another house, lots For Sale, the further out of BKK you go the cheaper they are.. many detached 3 and 4 bedroom house around the Villages where I live 1.8 - 3.2 million..

Yes bought/built 11 years ago, so has flooring I wanted, tiles I wanted.... I also have large Pond in the garden, and many dogs well 8 but just had 3 more born 10 days ago so now 11, [will sell them when older] you cannot do that in some Rented place, I can paint what and when I like, drill holes etc..

There are a couple of rented houses around 16,000 baht month in the Village, well in 11 years would have paid the price it cost back then and be left with nothing

as a P.S. I am 64 now, but as said have been here 11 years so far, so for me was well worth buying even if it is in my Partners name.

[CharlieH]

The only other point I would make is if you are new here and certainly for the first 5 years RENT then you can make a truly informed decision on whether Thailand is for you, if its not you can walk away.

If you are here 5 years, happy relationship (if applicable) then by that time you know the lay of the land etc and if you intend to stay, then is the time to buy and reduce your costs and settle in.

IMHO.

[kurnell]

I plan to retire soon and will spend 7 days a week mincing around my house, rent free.

[Deacon Bell]

Nope. The country is far too unstable in almost every way. Quality and maintenance work substandard to say the least. Perhaps a pigfarm or karaoke will open up next door.

Let alone what is going to happen within the next few years and the unknown there after.

Forget it. Thailand is for playing in.

[AnotherOneAmerican]

That's 15 years of rent, if you had 6M in the bank with no interest.

And when you rent no legal fees or maintenance fees.

So more like 23 years of rent, when you add in the extras.

But not so easy to sell and move, and you have no right to live in Thailand.

Not to mention it won't be in your name.

Doesn't look like such a good deal to me.

[MJP]

Nope. The country is far too unstable in almost every way. Quality and maintenance work substandard to say the least. Perhaps a pigfarm or karaoke will open up next door.

Let alone what is going to happen within the next few years and the unknown there after.

Forget it. Thailand is for playing in.

DB is quite right. It's an unstable country and certainly not a basket to put all your eggs in.

It's fine if you're rich (which I am definitely not) and can afford homes in Thailand and your home country, but it's not worth the risk and bother otherwise.

I built years ago when the Pound was a 76(!) and build costs were cheap. The homes are modest although pleasant but I wouldn't even consider it now.

[bowerboy]

Yeah even just from a numbers perspective it is hard to justify....add in all the other intangibles like instability, no actual right to live here etc and it seems pretty suicidal....i am not rich and so its not like I could afford to lose the money.

Buying something in the 2m to 3 m range seems more appealing on one hand (not so much to lose if it all goes wrong) but on the other hand those villages with houses of that price are even more likely to be non liveable 20 years from now.

Thanks for all the excellent thoughts.

[MJP]

Yeah even just from a numbers perspective it is hard to justify....add in all the other intangibles like instability, no actual right to live here etc and it seems pretty suicidal....i am not rich and so its not like I could afford to lose the money.

Buying something in the 2m to 3 m range seems more appealing on one hand (not so much to lose if it all goes wrong) but on the other hand those villages with houses of that price are even more likely to be non liveable 20 years from now.

Thanks for all the excellent thoughts.

Absolutely correct.

[slipperylobster]

People who say rent are often ones who cannot afford to buy, but wish they could.

Oftentimes, true.

However, the freedom of movement does wonders for those that do not own. My homes were purchased at a very young age (3 bought and sold within ten years)...and although the first two were wonderful, divorce led to quick sales.... The final one led to a loss of 40,000 usd, on a 200,000 dollar home. Then I realized I was only purchasing homes so that I felt successful. I was actually buying my own prison cells.

A bit wiser, I stopped buying houses that I could not sell. My last home was rented in Udon...3 bedroom/3 baht for 2500 baht a month. The lease is up on 1 August, and we decided to get in the car and travel the Northwest of Thailand. My wife wanted to stay near her elderly/disabled mom. She passed away recently, and wanderlust grabbed both of us. Just found a better home ...4 bedroom/3 bath in Chiang Mai for only 5000 baht a month. So now my wife is flying back to Udon to load up everything on her sister's flatbed and have our things delivered here on the first.

Flexibility is a wonderful thing. Extra money in the bank is nice, and the feeling that I can just walk away is priceless...should things go t_ts up here.

Edited July 13, 2014 by slipperylobster

[jacky54]

Renting is a mugs game if you are intending to stay permanently , money down the drain. However, it might make sense if you were uncertain about staying here and if you were still working. I would not have bought were I not retied, at my age I don't really care what happens in 20 years.

[kannot]

Easy to buy property in Thailand .....Hard (very hard) to sell....That being said ...Personally I have made money (or I should say my wife has ...which she has given me anyway) , but it wasn't easy and took awhile.

benefit of owning a home is it's yours (I wouldn't buy a condo,,,,corporate body fees, politics and maintenience money gone for nothing!)

Also I wouldn't buy the home your speaking of as it sounds too expensive!

Look for land and build your dream home ....can be done for under the 6,000,000 you're looking to spend (much cheaper!) but as pointed out earlier it's money gone! if you need it ...RENT!

good luck

Hard to sell "some" property but not all, condos up to 2-3million go quite fast, new or older, my Wife sells them regularly. Bigger money less buyers.

[MJP]

^^ The Lobster's doing it right.