Condo in Bangkok - To buy or not to buy?

[trogers]

1 hour ago, jippytum said:

Buy a resale unit not one off plan . What you see is what you get . Taxes should be 50/50.Check with the manager if the sinking fund has a credit balance before purchase . A healthy balance would indicate a well run building to go with the visual aspect of the common area and the condo you wish to purchase

 

A resale unit may well be a few years old and you can forget about any capital appreciation when the developer is still trying to clear old stocks off his inventory.

[blackcab]

4 hours ago, Ronuk said:

Please do not take anything for gospel EVER here in Thailand what you read in any newspaper or article that is written for the expat community. 

Go directly to the ministry of Labour and ask them. But before you do, read the law regarding foreign quota regarding condominiums. The law is there to stop exactly what your saying is legal.

 

Perhaps I can help with this discussion as I have been to the Ministry of Labour. I hold a work permit that specifically allows me to rent or lease immovable property (which is what a condo is) on behalf of the lessee or the lessor.

 

As has been said on this thread, a foreigner can lease out their own property for periods greater than 1 month. It's perfectly legal and the Department of Labour does not expect a foreigner to get a work permit to do this.

 

The foreigner should not, however, perform other duties for, or on behalf of paying guests who stay at their property. So no tour guiding, driving, making or delivering food, picking up or dropping off goods, no providing services such as health or beauty treatments and no repairing, replacing or renewing old, used or broken items in the condo. Don't even take out the trash while you have paying guests.

 

A good rule of thumb for foreigners to stay legal is to rent out for periods greater than 1 month and to remain passive at all times. If something really needs to be done then get a Thai person to do it, and don't supervise them.

 

Hopefully we can get this interesting thread back on track now.

[KittenKong]

9 minutes ago, blackcab said:

The foreigner should not, however, perform other duties for, or on behalf of paying guests who stay at their property. So no tour guiding, driving, making or delivering food, picking up or dropping off goods, no providing services such as health or beauty treatments and no repairing, replacing or renewing old, used or broken items in the condo. Don't even take out the trash while you have paying guests.

 

A good rule of thumb for foreigners to stay legal is to rent out for periods greater than 1 month and to remain passive at all times. If something really needs to be done then get a Thai person to do it, and don't supervise them.

 

That has always been my understanding also. As long as some Thai does all the work then you dont need a work permit. If you go "hands-on" then you probably do.

[KittenKong]

4 hours ago, 1130bobs said:

 In USA in most 'good' areas, the rent generally works out to equal the sale price in well under 10 years, thus it is much better as an investment risk (VIEWED AH HIGH RENTAL RATES).  I found in Thailand that this ratio is MUCH higher so that it CAN TAKE 14 - 16 years of rental to equal sales price.  Thus your instincts to not waste $ in rental, which was developed in a western market, must be softened for here.

 

The rental for my condo was under 4% of the asking price for the same unit. I would have taken me well over 20 years to pay out that amount in rent, or nearer 100 years if I allowed for the bank interest that depositing the purchase price would have brought me.

 

I take this as an indication that either real rental prices are very low (in which case there is probably little demand and too much competition) or that asking prices are ridiculously high (in which case they are a bad investment). Or both.

[HampiK]

17 minutes ago, blackcab said:

...then get a Thai person to do it, and don't supervise them.

 

This is the most difficult problem. Because it's only checking.. but actually this could lead to a problem, if they want give you problem.

I also was not aware for many years of "only" supervise can give you a problem

[trogers]

53 minutes ago, KittenKong said:

 

The rental for my condo was under 4% of the asking price for the same unit. I would have taken me well over 20 years to pay out that amount in rent, or nearer 100 years if I allowed for the bank interest that depositing the purchase price would have brought me.

 

I take this as an indication that either real rental prices are very low (in which case there is probably little demand and too much competition) or that asking prices are ridiculously high (in which case they are a bad investment). Or both.

 

When developers are offering guarantees on rental yields, you can be sure it is both...

[wilbuengkan]

Keep renting!!

Three years ago, I was foolish in buying a 97sq. meter condo in the Rama2 area.

Now, I am ready to leave Thailand and I am having trouble selling the unit.

The offers that I have received are no where close to what I paid for the condo.

I am resigned to the reality that I will take a big loss on this purchase.

Edited September 24, 2016 by wilbuengkan

[blackcab]

19 minutes ago, wilbuengkan said:

Keep renting!!

Three years ago, I was foolish in buying a 97sq. meter condo in the Rama2 area.

Now, I am ready to leave Thailand an I am having trouble selling the unit.

The offers that I have received are no where close to what I paid for the condo.

I am resigned to the reality that I will take a big loss on this purchase.

 

Out of intetest, what did you pay and what are you being offered?

[Scotwight]

I'd find a Thai lady you don't like and buy her a condo.  

[swerver]

23 hours ago, Familyonthemove said:

 

That's the dilemma I've been struggling with - as I know the market is saturated and there's always something new being built.

 

But here's the 'theory' .....

 

Over the next 6 or so years that I plan to be working and living in central Bangkok I will probably spend around 4 million THB in rent, (because of the high cost of wanting to live close to my office in Chidlom).  So my original plan was to buy a condo for around 4 million baht and live in that.  So after 6 years I'd have spent the same in deposit, loan repayments and interest as I would have spent in rent .... but I'd now have a paid for condo to either sell or rent out.

 

My theory started to show some holes when I found that the cost of a condo anywhere near the office is over 7 million THB.  But I reasoned that as the end game was a paid-for condo in central Bangkok, it may still make sense if I buy wisely. 

 

The maths are a bit suspect, as a 4 million THB condo would need to be out as far as Bearing - and that far out the rental is much less around Chidlom.  But perhaps there's an optimum model where I travel a but further, pay a bit less and still get a decent property rather than blowing a load of money on rent?  That's why I'm now looking at Asoke, Phrom Phong, Ekamai, On Nut - short motorsai ride distance from BTS, or centrally located condos in 'secondary' locations like Ruamrudee Soi 2/3,, Soi Nai Lert, Ploenchitt/Pratunam.

 

And that also explains how I've ground to a halt.  Case of falang thinking too much.

 

 

You are like everybody else, you want to live around the Sukhumvit area and if at all possible around the City Center area. Well you better budget ten million plus.  I see you mention Soi Ruamrudee, now you are really talking money. You have  champagne taste on a Beer budget.

Then you make a sensible comment Bearing Area but when you stay within walking distance of Sky train station you are still in high price territory.  If you go out Central City Bangna you get in your Beer budget. But there is no Sky train and in the middle of the night there is no motorcycle taxi from Bearing Station to Central Bangna.  Then when your contractual working condition time is up you go back home, wherever that might be. You think you can sale, think again. I have owned to live in several properties but all of them took not months but years to offload.  From decades in Thailand my advice, keep renting for the 5-6 years, pack you suitcase and go home. Now if you intent to retire in Thailand after contract completion, then buy, but in retirement I sure as hell would not live in the areas you now are talking about. I have lived in these areas during my working years but in retirement I landed up living on a golf course in the country away from the Bangkok SMOG.

LOL in LOS

[Airalee]

฿4,000,000 in rent over 6 years is roughly ฿55,000 a month.

 

฿4,000,000 condo would probably rent for ฿15,000 a month (or less)

 

 

 

 

 

 

[Canuk23]

You guys still recommend buying property under a Dictatorship regime ????

and will be for the next 10 years at least with the Junta controlling the 

senate and will step in if he  thinks necessary ??? 

[trogers]

10 minutes ago, Canuk23 said:

You guys still recommend buying property under a Dictatorship regime ????

and will be for the next 10 years at least with the Junta controlling the 

senate and will step in if he  thinks necessary ??? 

 

I look at market factors as more important considerations than politics, and political stability (in whatever form) is conducive for economic growth.

[newnative]

First, no problem with renting a condo as long as it's for more than a month--and no work permit needed.  I think you are doing the right amount of thinking--and that's good. Take your time and do your homework.   In your shoes, I would buy.  In five or six years you will have something more than a big pile of cancelled rent checks.  Plus, you will own your space and be able to do what you want with it--5 or 6 years is a long time to be living in someone else's space with someone else's furniture, art, etc.  Worse case, you will always have a roof over your head that you own.   You mentioned the choices as being overwhelming.  I would narrow it down somewhat and concentrate on name-brand Bangkok builders and their projects--such as Supalai, Sansari, Lumpini, SC Asset, and so on.  Unlike others, I would not rule out a new or newer building--they often have far more in the way of amenities.  In your shoes, I would set a budget of around 5MB and concentrate on small 1 bedroom condos with an easy walk to the subway.  Your idea is good to look for a location that is not too far out to be impractical and not too close to be over your budget.  Don't rule out small condos because you think you will not have enough storage.  I just sold a 29sqm 1 bedroom condo that I guarantee would have held all your clothing, luggage, shoes, sports equipment, housewares, toiletries, and anything else you would have needed to store, with ease.  Keep an open mind and look for a good room plan.  If possible, buy something unfurnished--it's likely the furniture and storage cabinets will not be good.  Take advantage of the design help at stores like Index and SB Furniture and custom design storage that is perfect for you.  Remember that a bed with 2 wide and deep drawers on either side takes up the same amount of floor space as one with no built-in storage.  29sqm may be too small for you but don't write off condos  35 to 40sqm--you may be surprised what an extra 5 or 10sqm can do for a well-designed room plan.  Good luck and have fun!

[mike324]

On 9/24/2016 at 11:07 AM, trogers said:

 

The buying habit for most Thai is still new condos, would make buying new and selling 5 years later non-feasible, as what is now new becomes old...

 

5 years later would not be consider as old, location and price is always the top consideration. Old would be pushing 7-8 years. I know a handful of buildings that are almost 10 years old, but highly desirable. These are usually the upper end condos. I have agents calling me monthly to see if I want to sell my 3 bedroom unit, as there is only a small number of 3 bed in my condo.

[trogers]

25 minutes ago, mike324 said:

 

5 years later would not be consider as old, location and price is always the top consideration. Old would be pushing 7-8 years. I know a handful of buildings that are almost 10 years old, but highly desirable. These are usually the upper end condos. I have agents calling me monthly to see if I want to sell my 3 bedroom unit, as there is only a small number of 3 bed in my condo.

 

I too get calls to offer buying my 2-bedroom and 3-bedroom units, and they are both in an over 30 years old building.

 

Such offers are from cash rich investors, and not the general public who depends on mortgages.

 

I have often said, Thais prefer buying new because banks offer easy financing terms. A 5-yo unit may not get easy financing terms.

Edited September 26, 2016 by trogers

[ExpatOilWorker]

On 23/9/2559 at 11:04 PM, Familyonthemove said:

 

Yes - I've looked at several of those, great locations - but with only 10 years left on a lease I may as well stay with the renting option.  Freehold is double the price and my sums go to pot.  My home country has good protection for leaseholders, but the law is very different here.

 

Up to you, but when renting you still have to ask your landlord for permission to drill a hole or anything else. For 3.6 million you can get 64 m2 of nice realestate in a prime area of town. 

[jadee]

9 hours ago, mike324 said:

 

5 years later would not be consider as old, location and price is always the top consideration. Old would be pushing 7-8 years. I know a handful of buildings that are almost 10 years old, but highly desirable. These are usually the upper end condos. I have agents calling me monthly to see if I want to sell my 3 bedroom unit, as there is only a small number of 3 bed in my condo.

That's interesting. What happens to the low and mid condos when they age? At 8 years+ do they start losing money? 

[wpcoe]

6 hours ago, ExpatOilWorker said:

 

Up to you, but when renting you still have to ask your landlord for permission to drill a hole or anything else. For 3.6 million you can get 64 m2 of nice realestate in a prime area of town. 

 

Doing the math on that, it really doesn't sound bad:  B3.6m divided by 120 months (10 years) is B30,000/month which isn't so bad for a 64 sq.m unit in a decent neighborhood.  And, *maybe* at 10 years, the lease would be renegotiated and extended?

[mike324]

12 hours ago, jadee said:

That's interesting. What happens to the low and mid condos when they age? At 8 years+ do they start losing money? 

 

 all condo prices will rise over time regardless of quality. I say very few will lose its value unless you overpaid in the first place, its only a matter of how much it rises and how desirable / easy it would be to sell later on.

[trogers]

1 hour ago, mike324 said:

 

 all condo prices will rise over time regardless of quality. I say very few will lose its value unless you overpaid in the first place, its only a matter of how much it rises and how desirable / easy it would be to sell later on.

 

Not true. Location is the key. Badly located ones would not see appreciation for decades, while those foreclosed would be auctioned off at well below purchase prices.

[blackcab]

1 hour ago, mike324 said:

 

 all condo prices will rise over time regardless of quality. I say very few will lose its value unless you overpaid in the first place, its only a matter of how much it rises and how desirable / easy it would be to sell later on.

 

I can't agree with that. If the building has really bad management and the common areas look like a train crash, the facilities are broken and the lifts don't work then the price will decrease, not increase.

[mike324]

3 hours ago, trogers said:

 

Not true. Location is the key. Badly located ones would not see appreciation for decades, while those foreclosed would be auctioned off at well below purchase prices.

 

I agree, badly located ones won't appreciate for decades, but they still do was my point. Not many people on TV will be purchasing foreclosed properties, so kind of goes without saying that forecloses properties are below purchase prices.

[mike324]

3 hours ago, blackcab said:

 

I can't agree with that. If the building has really bad management and the common areas look like a train crash, the facilities are broken and the lifts don't work then the price will decrease, not increase.

 

There are always exceptions, my statement was just a generalization not meant to be taken as 100%, should have been more clear. But how many condos do you know have decreased in value from the original selling price?

[blackcab]

That's difficult to answer. I think it's more a case that there are many condos that aren't selling for the asking price, even when that is the same as the purchase price.

 

So a loss hasn't been crystallised, but no sale has been made. 

[Familyonthemove]

Update: Looked at 8 condos over the weekend - liked one a lot - but it's pushing the budget so all the useful feedback about the possible folly of my rent vs buying plan was highlighted, but it's still an option.  A new one within budget was nice but small and in a central location so that's also a possible.

 

But there was one 'wild card' in the mix that I think would be a really bad idea - but it got me thinking .....

 

Can a 'failing' condo building ever recover?

 

It's in Soi Ruamrudee - so very central and traditionally a high cost buying and rental area.  The condo interior needs work - new kitchen, bathroom and ceiling, (and I guess about 500k THB for this), but it's a very low price for the area.  But the rest of the building has issues.

 

Structure looks sound (as far as I can tell) but roof has leaked, exterior needs painting and the pool is knackered (see photo).  Maintenance is low at 40 THB per sq. m and half the owners do not pay.  They claim the Society is in credit and there's a plan to increase maintenance to 50 THB and force owners to pay.  There's also a plan to fix the roof and paint the exterior, but not to fix the pool.

 

I'm guessing the plans by the Juristic Person are ambitious and the building will slowly fall apart - so even if I fix up the condo, the value will continue to fall because of the state of the building?

 

But the price and location is right.  Could it be an option? What's the thoughts of the panel?

 

[trogers]

4 minutes ago, Familyonthemove said:

Update: Looked at 8 condos over the weekend - liked one a lot - but it's pushing the budget so all the useful feedback about the possible folly of my rent vs buying plan was highlighted, but it's still an option.  A new one within budget was nice but small and in a central location so that's also a possible.

 

But there was one 'wild card' in the mix that I think would be a really bad idea - but it got me thinking .....

 

Can a 'failing' condo building ever recover?

 

It's in Soi Ruamrudee - so very central and traditionally a high cost buying and rental area.  The condo interior needs work - new kitchen, bathroom and ceiling, (and I guess about 500k THB for this), but it's a very low price for the area.  But the rest of the building has issues.

 

Structure looks sound (as far as I can tell) but roof has leaked, exterior needs painting and the pool is knackered (see photo).  Maintenance is low at 40 THB per sq. m and half the owners do not pay.  They claim the Society is in credit and there's a plan to increase maintenance to 50 THB and force owners to pay.  There's also a plan to fix the roof and paint the exterior, but not to fix the pool.

 

I'm guessing the plans by the Juristic Person are ambitious and the building will slowly fall apart - so even if I fix up the condo, the value will continue to fall because of the state of the building?

 

But the price and location is right.  Could it be an option? What's the thoughts of the panel?

 

 

"...and half the owners do not pay..."

 

Don't touch it. Tenants would prefer a better building even if the location is less central.

 

Would you rent it as a tenant?

[trogers]

4 minutes ago, Familyonthemove said:

Update: Looked at 8 condos over the weekend - liked one a lot - but it's pushing the budget so all the useful feedback about the possible folly of my rent vs buying plan was highlighted, but it's still an option.  A new one within budget was nice but small and in a central location so that's also a possible.

 

But there was one 'wild card' in the mix that I think would be a really bad idea - but it got me thinking .....

 

Can a 'failing' condo building ever recover?

 

It's in Soi Ruamrudee - so very central and traditionally a high cost buying and rental area.  The condo interior needs work - new kitchen, bathroom and ceiling, (and I guess about 500k THB for this), but it's a very low price for the area.  But the rest of the building has issues.

 

Structure looks sound (as far as I can tell) but roof has leaked, exterior needs painting and the pool is knackered (see photo).  Maintenance is low at 40 THB per sq. m and half the owners do not pay.  They claim the Society is in credit and there's a plan to increase maintenance to 50 THB and force owners to pay.  There's also a plan to fix the roof and paint the exterior, but not to fix the pool.

 

I'm guessing the plans by the Juristic Person are ambitious and the building will slowly fall apart - so even if I fix up the condo, the value will continue to fall because of the state of the building?

 

But the price and location is right.  Could it be an option? What's the thoughts of the panel?

 

 

"...and half the owners do not pay..."

 

Don't touch it. Tenants would prefer a better building even if the location is less central.

 

Would you rent it as a tenant?

[trogers]

4 hours ago, mike324 said:

 

There are always exceptions, my statement was just a generalization not meant to be taken as 100%, should have been more clear. But how many condos do you know have decreased in value from the original selling price?

 

Real value decreases when capital appreciation is not covering long term inflation.

[Peterw42]

22 minutes ago, Familyonthemove said:

Update: Looked at 8 condos over the weekend - liked one a lot - but it's pushing the budget so all the useful feedback about the possible folly of my rent vs buying plan was highlighted, but it's still an option.  A new one within budget was nice but small and in a central location so that's also a possible.

 

But there was one 'wild card' in the mix that I think would be a really bad idea - but it got me thinking .....

 

Can a 'failing' condo building ever recover?

 

It's in Soi Ruamrudee - so very central and traditionally a high cost buying and rental area.  The condo interior needs work - new kitchen, bathroom and ceiling, (and I guess about 500k THB for this), but it's a very low price for the area.  But the rest of the building has issues.

 

Structure looks sound (as far as I can tell) but roof has leaked, exterior needs painting and the pool is knackered (see photo).  Maintenance is low at 40 THB per sq. m and half the owners do not pay.  They claim the Society is in credit and there's a plan to increase maintenance to 50 THB and force owners to pay.  There's also a plan to fix the roof and paint the exterior, but not to fix the pool.

 

I'm guessing the plans by the Juristic Person are ambitious and the building will slowly fall apart - so even if I fix up the condo, the value will continue to fall because of the state of the building?

 

But the price and location is right.  Could it be an option? What's the thoughts of the panel?

 

 

There is always the option to get on the condo commitee and raise hell, find other owners and make things happen. I have seen a block in pattaya were a couple of westeners are on the commitee and have turned the block around. Things are getting repaired, utilities cut off for non payment of fees etc.