Condos as an investment proposition?

[Saan]

I hope that people who have bought a condo as an investment may help me.

I want to know whether it is better to buy a smaller unit very close in or to move out a little, say near Nong Hoi or the railway station, and get a larger unit at about the same price. Which option would be the better rental proposition?

I'd also be grateful to hear what other facilities, such as a swimming pool, make a property more attractive for rental and do these units attract a higher rental?

[elektrified]

Good idea but 5 years too late (IMO).

[alfieconn]

Good idea but 5 years too late (IMO).

Can't see what difference the time element makes if he is buying as a long term investment ! unless your saying that they have gone up significantly over the last 5 years.

[shirtless]

Its a buyers market so look for the best deal

[WinnieTheKhwai]

I'm not sure the main premise is correct, that further out will be cheaper (for a larger unit).

I think the choice is mostly between buying in an old building and renovating, but cheaper to buy and close in town, or buying new, which tends to be further away and in areas with big traffic jams. (Like Nimman and Canal Road)

And as for making money on the investment: you're doing well if you come out ahead within your lifetime.

Then again, I bought a house not too long ago. If things keep up then it will have paid for itself in 8 years or so, 7 still to go. After that it would start making money if I don't count the interest lost on the investment. Note the 'if' by the way; there is a cost associated with the risk, given that we can have a Thai killing fields on our hands in a couple years. And I consider this pretty much a 'jackpot' scenario, again assuming things keep up.

As far as investments go, I don't think property in Thailand is a particularly good one especially if you have the money and can invest it anywhere. It may be different if you actually need a place to live, or if you want to gather some assets for your kids to inherit, assuming they'd even want to live in Thailand and no killing fields materialized.

And it's different for me also because property is one of the few things you can get financed from a bank fairly easily. Banks won't give you a couple million to go invest in anything else, but they'll play ball if you find a Thai wife to smile at them.

Edited November 26, 2014 by WinnieTheKhwai

[NigelKennedy]

Hello Saan

There are some good deals out there but more bad ones...you have to do your homework..bought 8 studios two years ago for 260k each spent 260k renovating now can sell for 680k.

Would advise talking to a buying agent who works for you and not seller...best in CM seem to be "buyinchiangmai".

[haybilly]

WTK--I am with you with the 'Killing Fields' scenario......who knows??

[baywatch82]

Location is the most important.
I recommend Nimmanhemin area as it is constantly growing and improving with modern shops and restaurant. You will always find tenants to live there. Another option is near Maya or Central Festival.

My suggestion is to buy cheap studios in old buildings and spend some money to renovate it. New condos are too expensive.

You should think about minimum 10% yearly return.

For example:

I have bought studio room near Nimmanhemin 4 months ago for 500,000 baht in old building. Spent 200,000 baht for total renovation and furniture. I am renting this out for 7000 baht per month now, which gives me about 11% yearly return.

Of course if you get a good deal you can do better than 10%.

[WinnieTheKhwai]

^ Can't go wrong with 500K in Nimman.

Any more units there?

[NigelKennedy]

Some people buying in JC Hill Place renovating and renting 8k

[haybilly]

Sounds interesting.

Too late now, though.

[true blue]

it seems property prices seem to stay pretty static in cnx,of course as some one mentioned 5years ago the exchange rates were in farangs favour, only in favour now if you sell.

[uptheos]

Location is the most important.

I recommend Nimmanhemin area as it is constantly growing and improving with modern shops and restaurant. You will always find tenants to live there. Another option is near Maya or Central Festival.

My suggestion is to buy cheap studios in old buildings and spend some money to renovate it. New condos are too expensive.

You should think about minimum 10% yearly return.

For example:

I have bought studio room near Nimmanhemin 4 months ago for 500,000 baht in old building. Spent 200,000 baht for total renovation and furniture. I am renting this out for 7000 baht per month now, which gives me about 11% yearly return.

Of course if you get a good deal you can do better than 10%.

Buy a unit for 500,000 spend 200,000 and do it up nicely.

If you can get 7,000 a month in about 9 years you've got your money back.

[heybruce]

Location is the most important.

I recommend Nimmanhemin area as it is constantly growing and improving with modern shops and restaurant. You will always find tenants to live there. Another option is near Maya or Central Festival.

My suggestion is to buy cheap studios in old buildings and spend some money to renovate it. New condos are too expensive.

You should think about minimum 10% yearly return.

For example:

I have bought studio room near Nimmanhemin 4 months ago for 500,000 baht in old building. Spent 200,000 baht for total renovation and furniture. I am renting this out for 7000 baht per month now, which gives me about 11% yearly return.

Of course if you get a good deal you can do better than 10%.

"I am renting this out for 7000 baht per month now, which gives me about 11% yearly return."

11% assuming it stays rented, and you don't get the tenant from h*ll who trashes the place. The risk of bad tenants and long periods of vacancy are part of the risk assessment.

[mesquite]

Please review this TV topic before laying out money for a condo in Thailand

http://www.thaivisa.com/forum/topic/779489-todays-smh-26-nov-eviction-threat-for-australians-who-put-life-savings-into-thai-dream-homes/

[Saan]

Hello Saan

There are some good deals out there but more bad ones...you have to do your homework..bought 8 studios two years ago for 260k each spent 260k renovating now can sell for 680k.

Would advise talking to a buying agent who works for you and not seller...best in CM seem to be "buyinchiangmai".

I thought the principals of Buyinchiangmai were associated with a large Chiang Mai real estate company, at least they were awhile ago.

[BritManToo]

it seems property prices seem to stay pretty static in cnx,of course as some one mentioned 5years ago the exchange rates were in farangs favour, only in favour now if you sell.

5 years ago the UKP/bht exchange rate was the same as it is now.

[WinnieTheKhwai]

Some people buying in JC Hill Place renovating and renting 8k

I'd say that's optimistic.

[NigelKennedy]

Hello Saan...think owner used to work for an estate agent and set up his own independant company as a buyers agent.

[true blue]

it seems property prices seem to stay pretty static in cnx,of course as some one mentioned 5years ago the exchange rates were in farangs favour, only in favour now if you sell.

5 years ago the UKP/bht exchange rate was the same as it is now.

you were properly right mate it was nearly 8/9years ago when i bought, and i was talking about time flies doesnt it.

[true blue]

could be wrong but wasnt there some visa restrictions on buying property just for sole purpose to rent,be interesting to no if so.

[Scrubber]

Location, as always, is all important. Go for highly sort after areas with a limited amount of space. I bought a new unit at the Punna on Nimmanhaemin Soi 6 when it was being built roughly 5 years ago for 1.5 million baht. I sold it just over a year ago for 2.9 million.

[iainiain101]

Assuming one wants to stay strictly legal, what's the tax situation on renting out and selling condos? What level does income tax kick in and at what rate? Is there a gains tax on sales?

[baywatch82]

Buy a unit for 500,000 spend 200,000 and do it up nicely.

If you can get 7,000 a month in about 9 years you've got your money back.

Yes and I am happy with this result. Property appreciation over those 9 years is important also.

[baywatch82]

"I am renting this out for 7000 baht per month now, which gives me about 11% yearly return."

11% assuming it stays rented, and you don't get the tenant from h*ll who trashes the place. The risk of bad tenants and long periods of vacancy are part of the risk assessment.

That's right. But nicely renovated and furnished condo, with kitchen and separated bedroom, for 7000 baht per month, is not waiting for tenant long in Nimman area. I was waiting only 4 days to have it occupied from the moment when I posted ad.

The risk is always, and if you are afraid or risk, you should stay away of any business.

[baywatch82]

^ Can't go wrong with 500K in Nimman.

Any more units there?

A lot !

[NigelKennedy]

Hello Baywatch. ..which condo blocks for 500k in Nimman.

[wisemonkey]

there is a cost associated with the risk, given that we can have a Thai killing fields on our hands in a couple years. And I consider this pretty much a 'jackpot' scenario, again assuming things keep up.

Are you meaning literal killing fields as in the mass graves in Cambodia? Strange thing to come up with when talking about real estate.. I mean if you are going down the disaster path I would think there are a million other scenarios which would happen before killing fields such as earth quakes. If you did have an apartment and a killing field was discovered a few kms away would it really make a difference? I must be missing something.

As far as it not being a good investment, that is yet to be seen, the truth is no one knows the future, with growing chinese middle class and cheap property prices in Chiang Mai, it could be a great time to get in.

I dont subscibe to the because it thailand its not a good investment, thats just craziness. Investment is a risk anywhere, just ask the people who lost their life savings and homes investing in property in the USA in 2008. If you had invested in property in both thailand and usa in 2005, I dare say your return would be better in thailand, ofcourse depends on location, house, etc.. my point being no one knows the future, what is considered strong and safe today could have a financial crises in a year, and what is considered risky and bad value, could be worth double what it is in 5 years.. nature of the game.

[cooked]

I read recently (sorry I can't remember where) that the loop hole whereby Farangs can buy a condo is to be closed. The market seems to be drying out in Bangkok at least, the times when you could buy a condo, rent it for 7 years and then sell it for double are gone.

[mesquite]

I read recently (sorry I can't remember where) that the loop hole whereby Farangs can buy a condo is to be closed. The market seems to be drying out in Bangkok at least, the times when you could buy a condo, rent it for 7 years and then sell it for double are gone.

Doubtful.