Why are rents lower in Thailand than other nearby countries

[Hal65]

I notice that rents in Thailand are lower than other nearby countries, Some of them even poorer than Thailand. Cambodia and the Philippines come to mind. I've also heard that Laos and Vietnam have higher rents compared to a similar type of city/area.

Anyone know why rents are comparatively cheap in Thailand?

[benalibina]

More rentals on offer.

[harrry]

Because everyone builds condos or houses to hold for the land value and up till now there was no land tax. This means that there is a glut of accomodation.

[zierf1]

I say BULL. Where are the poor locals staying at then? Obviously they aren't shellling out $300-$1,200+ a month for rent if their income is $200 a month. The stuff you can search for on Google is for super rich expats on expense accounts. IGNORE IT. There are little known Philippines classified ads where you could find little fan rooms for 4,000 pesos per month or less. Check out sites like ayosdito.com. Tons of cheap rooms on there.

As for the other countries, I think there are similarly cheap rooms in those countries as well. I've seen them and I KNOW they exist. So maybe the locals are just trying to hide them from us.

[ukrules]

You're probably looking at modern apartments of which there is a shortage in certain local countries - this makes them more expensive due to the scarcity.

If you want to live in a tiny crappy hole of a place it will be very cheap wherever you go. There's no shortage of these anywhere.

There's no shortage of modern accomodation in Thailand, in fact there's an oversupply.

Supply and demand...

Supply low, demand high = higher prices (Other places)

Supply high, demand low = lower prices (Thailand)

Simple.

[OnMyWay2]

Cambodia doesnt have much middle class. If youre not living in the slums its assumed you're a wealthy diplomat.

[siam2007]

Condos are few and far between and until a few years ago, were virtually non-existent in Laos, Cambodia, Myanmar.

rent in Thailand in fact is NOT cheaper than in other countries with a similar economical situation such as Malaysia. In KL, which has plenty of Condos and high-rise apartment buildings since decades, the rent is even cheaper.

As for the Philippines: Virtually EVERYTHING is overpriced there, as the country, despite being called a "democracy" is actually ruled by a few super-rich family-clans who have a monopoly in many products and services, so they can charge ridiculous amounts and exploit the people and make their life miserable - my friends in Manila pay up to 2000% more for water supply than I do here in BKK. Pharmaceutical products are a lot more expensive than in any Western, let alone Asian, country - simply because the market is controlled by one rich clan who can (and do) charge whatever they want, making healthcare unaffordable to most of the regular Filipinos.

As for the Condos in the PH - same rule applies: substandard quality of construction at artificially inflated prices. so the same inflated prices are being asked when the owners of Condo-units rent out their property. good luck when the next strong earthquake strikes Manila and the PH, which will invariably happen rather sooner than later.....

Edited October 17, 2014 by siam2007

[OnMyWay2]

I noticed this in Vietnam too the western standard facilities charge western prices because none of the locals go there.

[ldnguy]

Prices reflect supply and demand. That's basic economics. I suggest you read a beginner's economics book. In Thailand's case, lost of condos with not enough renters. So supply outstrips demand. In countries like Laos there is more demand than supply. Simple economics.

[Mzungu]

Malaysia has cheaper rents. Or rather KL has cheaper rents than BKK

[ldnguy]

I noticed this in Vietnam too the western standard facilities charge western prices because none of the locals go there.

They don't charge Western prices because locals don't go there, but because there is enough demand to sustain the prices. Do you seriously think they would lower their prices for locals? Get real. Locals don't go there because the prices are too high, not vice versa as you as suggesting.

[OnMyWay2]

I noticed this in Vietnam too the western standard facilities charge western prices because none of the locals go there.

They don't charge Western prices because locals don't go there, but because there is enough demand to sustain the prices. Do you seriously think they would lower their prices for locals? Get real. Locals don't go there because the prices are too high, not vice versa as you as suggesting.

Actually it is vice versa. They built the place to western standards in order to cater to westerners. At western prices.

[realenglish1]

Prices reflect supply and demand. That's basic economics. I suggest you read a beginner's economics book. In Thailand's case, lost of condos with not enough renters. So supply outstrips demand. In countries like Laos there is more demand than supply. Simple economics.

Your Crazy Price here in Thailand does not reflect supply and demand. Builders put up a condo and to attract buyers they artificially raise prices. This sort of business model will utility fail when the builders price themselves out of the market.

The other factor that will affect price is the new real estate tax. I suspect there will be an adjustment in price downward once people realize that it will cost money to maintain their property.

The condo market is one step away from disaster. Highly over inflated

[LennyW]

Malaysia has cheaper rents. Or rather KL has cheaper rents than BKK

But beer is a lot more expensive in KL/Malaysia!! :-)

[masuk]

Because everyone builds condos or houses to hold for the land value and up till now there was no land tax. This means that there is a glut of accomodation.

AGREED. Put your wealth in the bank at 2%? Property is better.

Here in Chiang Mai new apartment/condo blocks are going up like mushrooms. There must be over-supply.

[Alwyn]

The reason rents are lower in Thailand than in nearby countries is because the rent in nearby countries is higher than Thailand.

[PaulHamon]

SUPPLY AND DEMAND.

[trogers]

Malaysia has cheaper rents. Or rather KL has cheaper rents than BKK

This is because there is less foreigners staying long term there. Compare the queues at Immigration between these two countries.

[NoshowJones]

The reason rents are lower in Thailand than in nearby countries is because the rent in nearby countries is higher than Thailand.

You are kidding aren't you?

[siam2007]

Malaysia has cheaper rents. Or rather KL has cheaper rents than BKK

But beer is a lot more expensive in KL/Malaysia!! :-)

not on Beautiful Langkawi and Labuan

[elgordo38]

I live in a nice clean condo in Chiang Mai close to everything 40 square metres. We have a nice pool good neighbors good security. I only pay 4,000 bahts a month plus utilities at market rate not inflated rates.

[Alwyn]

The reason rents are lower in Thailand than in nearby countries is because the rent in nearby countries is higher than Thailand.

You are kidding aren't you?

No, I'm really serious.... of course I'm kidding although when I look at some posts I can see why you'd want to qualify it!!

[Mzungu]

Malaysia has cheaper rents. Or rather KL has cheaper rents than BKK

This is because there is less foreigners staying long term there. Compare the queues at Immigration between these two countries.

Don't know how long you have to wait at KL but BKK immigration is VERY short

[Mudcrab]

You're probably looking at modern apartments of which there is a shortage in certain local countries - this makes them more expensive due to the scarcity.

If you want to live in a tiny crappy hole of a place it will be very cheap wherever you go. There's no shortage of these anywhere.

There's no shortage of modern accomodation in Thailand, in fact there's an oversupply.

Supply and demand...

Supply low, demand high = higher prices (Other places)

Supply high, demand low = lower prices (Thailand)

Simple.

Apparently your Thainess is slipping. On may other threads it seems that when demand drops off Thais increase the price to make up for lost profits.

[ukrules]

You're probably looking at modern apartments of which there is a shortage in certain local countries - this makes them more expensive due to the scarcity.

If you want to live in a tiny crappy hole of a place it will be very cheap wherever you go. There's no shortage of these anywhere.

There's no shortage of modern accomodation in Thailand, in fact there's an oversupply.

Supply and demand...

Supply low, demand high = higher prices (Other places)

Supply high, demand low = lower prices (Thailand)

Simple.

Apparently your Thainess is slipping. On may other threads it seems that when demand drops off Thais increase the price to make up for lost profits.

Oh, don't worry - there's still plenty of that going on.

It's just that people can see they get twice the condo size for much less money if they spend just a couple of hours looking around so it doesn't work so much.

What makes me laugh is the people who are trying to sell their massively overpriced homes for twice the price they're worth.

I know one guy who's been holding out for well over a year now trying to sell one for double it's value, he won't budge on the price because that's what he thinks it's worth. Nobody else agrees so it remains unsold.

[MexicanFarang]

Do they know how to build a shower floor that slopes down to a drain in neighboring countries?

555...

[ldnguy]

Prices reflect supply and demand. That's basic economics. I suggest you read a beginner's economics book. In Thailand's case, lost of condos with not enough renters. So supply outstrips demand. In countries like Laos there is more demand than supply. Simple economics.

Your Crazy Price here in Thailand does not reflect supply and demand. Builders put up a condo and to attract buyers they artificially raise prices. This sort of business model will utility fail when the builders price themselves out of the market.

The other factor that will affect price is the new real estate tax. I suspect there will be an adjustment in price downward once people realize that it will cost money to maintain their property.

The condo market is one step away from disaster. Highly over inflated

Maybe you don't realize how rich some of these condo buyers are. Many own multiple condos and a property tax would be nothing to them. They have stacks of money.

[ldnguy]

I noticed this in Vietnam too the western standard facilities charge western prices because none of the locals go there.

They don't charge Western prices because locals don't go there, but because there is enough demand to sustain the prices. Do you seriously think they would lower their prices for locals? Get real. Locals don't go there because the prices are too high, not vice versa as you as suggesting.

Actually it is vice versa. They built the place to western standards in order to cater to westerners. At western prices.

You are actually agreeing with me. You say it was built to Western standards, so that means locals can't afford to go they. You originally said they charge Western prices because none of the locals go there. You're now saying the complete opposite.

[orpheus454]

The reason rents are lower in Thailand than in nearby countries is because the rent in nearby countries is higher than Thailand.

My god I think you've nailed it there, Alwyn...!

Who'd've thought...?

[Hal65]

No doubt supply and demand is the big determining factor. I was hoping to hear some comments about how the local politics affects rental demand. Or lax zoning, building codes, labor markets reduce construction costs (not sure if this is true, I'm just speculating)