Renting Instead of Buying in Chiang Mai?

[BayLay]

Hi...

i am brand new here.  Currently still working in US but thinking of (somewhat) early retirement and moving to Chiang Mai within the next 5 years.  I am a Thai and US citizen.  My spouse is American.

My brother moved to Chiang Mai 10 years ago and we are thinking of retiring there, may be part time.  We recently went to Chiang Mai to scope out housing and was quite surprised at how much it costs.to buy a decent house there.  We live in a suburb in Midwest, and have a new 2,000 sqft house with good size landscaped garden for a little more than $200,000.    Grocery stores and a couple of casual restaurants within walking distance.  Yet the subdivision is quiet and only 15 minutes from work.

if we want something like that in Chiang Mai, it would cost much more.   Not sure if we want to sink our money in it.

 

i am thinking of renting a small (but comfortable and nice) house, or even condo, instead.  But not sure if that will be a good idea.  Would appreciate your opinions.  Thank you.

 

[NanLaew]

Agreed on very poor bang for your buck here in Thailand, particularly in the expat traps. The only way of getting something of commensurate size/cost is to invest in a one-off construction in one of the lesser-known, less popular provincial hubs or something in the boonies but you can lose a lot on the local amenities, especially with the latter. Renting anywhere in Thailand is a sound investment with the added benefit of the ability of walking away if/when things do not work out. Also good advice to keep the floor size within reason. I have seen a few friends build the palatial +4 bed + guest quarters + maids quarters retirement villa with a large pool and tended grounds with fish ponds when they were younger but once they turned 65, the cleaning, upkeep and maintenance was too much and increasingly expensive.

[ezzra]

You think CM is expensive... come to BKK to the inner city and the immediate

surrounding suburbs and how expensive house are there to buy

 and you'll be only to happy to by in CM ......

[BayLay]

Thanks for your opinions.   

Nanlaew- I found it true that as we get older, bigger house is more of a burden than joy.  So I want a small and easy to maintain place.  Still hoping for a bit of privacy if possible.

 

[guzzi850m2]

Can't you get a nice little house in CM for app 3-4mill?

 

Always rent before buying anything so you are sure you made the right decision and you can walk away if renting very easy. 

 

Yes agreed about the big mansion, when old/no kids what the point, expect bragging rights.

[BayLay]

Ezra- I do have an idea of the price in Bangkok.  You are right, it's crazy.  My other brother has a nice house in one of the high-end moobaans near Fashion Island in Bangkok.   about $1 million all said and done.  (30+million baht).   He could have bought one of the lakeside mansions where I live.  But over there, it was just a nice house in a nice neighborhood.  I was also disappointed in the build quality overall, which is might as well, since I cannot afford it.  :-)

 

still hoping to hear from people who have rented a reasonable quality housing in Chiang Mai.   Thanks again.

[1FinickyOne]

Well, 3-4 MM is less than your investment in USA... but for 5-6MM I do see places advertised with a small pool... I think you can shop around quite a bit and see all the places available online... but the best advice is to shop around after you get here and try and find a bargain, which might in reality be closer to market value. There is so much available and unused property here and unlike USA where you can look at comparable and multi listed properties, the market appears more opaque and tough to know the real value of places. Also, you will need the time to figure out what part of CM you want to live...

 

But, just google CM real estate and you will find more property listings than you can imagine. 

 

Good luck.

[what2do]

I thought foreigner can not buy houses but only condos because by law foreigners can not own lands

[Lizard2010]

1 minute ago, what2do said:

I thought foreigner can not buy houses but only condos because by law foreigners can not own lands

He is a THai

So should be able to buy

[Lizard2010]

I would suggest that you do not over capitalise you investment here

 

Because if you go to try to sell it can be hard

 

Also watch out for noisy neighbors  They will always make noise

 

If you buy a condo Only buy a new One

 

As after 10 years so many problems which could cost a lot of money

 

My condo is around 20 years old so many problems

 

Always water leaking every 2 to 4 weeks

 

Many rooms being renovated  So much noise daily

 

I am just trying to be honest to you

 

 

[what2do]

3 minutes ago, Lizard2010 said:

He is a THai

So should be able to buy

My bad, did not read correctly.  Yeah it's pretty much sucks that price of house is same as some condos but you can not buy them because you are not thai. Well at least locals will not blame foreigner for driving up the housing market.

[StefanBBK]

Take your time. 5-6M will eventually get you something nice.
Renting is ok for short term. On the long run its a losing proposition.

[what2do]

Well is the Thai culture focus on owning as higher social status than renting? I know Chinese heavily believe owning is better than renting even when renting is much much more cost effective.  I hope Thai does not follow this stigma because it really annoy me that every local Chinese I met ask me if I own or rent.

Edited January 11, 2017 by what2do

[sfokevin]

I went the renting route... I found a nice older house in a exclusive mubaan it needed a lot of work but the rent is 15k baht a month... the Thai lady who owns it lives in Bangkok and is happy for me to stay forever!... I spent about 300k redoing it... painted everything, new tile in kitchen and baths... and am now installing a koy pond deck...  this house in the US would cost $250k USD...

[lkn]

25 minutes ago, StefanBBK said:

Take your time. 5-6M will eventually get you something nice.

 

$200,000 is actually 7.2 million THB, but they are coming from a 2,000 sqft house (= 186 m²). I think the issue might be this: “Grocery stores and a couple of casual restaurants within walking distance” — western style restaurants and grocery stores are not easily found outside the central city, but a 186 m² house in the central city does not come cheap.

 

If you can settle with semi-walking distance to something like Kad Farang then I think there should be plenty of options.

 

[LivinLOS]

3 hours ago, ezzra said:

You think CM is expensive... come to BKK to the inner city and the immediate

surrounding suburbs and how expensive house are there to buy

 and you'll be only to happy to by in CM ......

 

 

Or Phuket or anything of quality on Samui.. Hell even Khon Khen and Udon seems oddly expensive (more than here). 

 

To the OP.. Yes rent.. 

[worgeordie]

53 minutes ago, sfokevin said:

I went the renting route... I found a nice older house in a exclusive mubaan it needed a lot of work but the rent is 15k baht a month... the Thai lady who owns it lives in Bangkok and is happy for me to stay forever!... I spent about 300k redoing it... painted everything, new tile in kitchen and baths... and am now installing a koy pond deck...  this house in the US would cost $250k USD...

You spent 300K on making improvements on someone else's house !,

just because she says you can live there forever,i hope you have a lease

that covers that, you are the kind of tenant that every landlord dreams of.

regards worgeordie

[puukao]

Rent for the first 20-years, then we will talk.

 

after a few years of death pollution you will be happy you can leave....especially coming from either WI, MN, IA, NE, wherever......this air quality will kill you.  i wish i was joking.  google it...

 

soon the traffic will be crazy and the noise will be insane for another decade or so..

 

it's really very, very unfortunate you only have BKK or CM to really choose from.  BKK, never.  

 

I would start by 6 months in CM and 6 months back in America... 

 

 

[sfokevin]

3 hours ago, worgeordie said:

You spent 300K on making improvements on someone else's house !,

just because she says you can live there forever,i hope you have a lease

that covers that, you are the kind of tenant that every landlord dreams of.

regards worgeordie

I have a 5 year lease (registered) much below what others are paying in my mubaan ... and in a worse case scenario I could remove about half my investment and move to another house... in the end I got the house I like and that is all that matters..,

[Lizard2010]

2 minutes ago, sfokevin said:

I have a 5 year lease (registered) much below what others are paying in my mubaan ... and in a worse case scenario I could remove about half my investment and move to another house... in the end I got the house I like and that is all that matters..,

Good for you

My Condo had termite problem

Need a little repair

I can live with this

So owner give at a reduced cost

Win win for both of us

[cmtg1]

5 hours ago, sfokevin said:

I went the renting route... I found a nice older house in a exclusive mubaan it needed a lot of work but the rent is 15k baht a month... the Thai lady who owns it lives in Bangkok and is happy for me to stay forever!... I spent about 300k redoing it... painted everything, new tile in kitchen and baths... and am now installing a koy pond deck...  this house in the US would cost $250k USD...

250K would hardly buy you a studio  in the US.Not a good comparison 

[cmtg1]

why are we even responding to the post. In five years nothing that they are researching will be the same

[luther]

17 minutes ago, cmtg1 said:

why are we even responding to the post. In five years nothing that they are researching will be the same

Perfect arguement for renting.

 

Almost everyone I know who has lived here for more than a couple years rents a house. Most live in fabulous houses with great landlords willing to put up money towards improvements in return for stable, caring renters. Outside the city, most of these folks pay 10 – 20 K baht per month. Almost all of these people rented something decent for a year or two and then found something great. It's the way to go especially if you don't want to live in a cookie cutter moobaan.

[EricTh]

15 hours ago, BayLay said:

Thanks for your opinions.   

Nanlaew- I found it true that as we get older, bigger house is more of a burden than joy.  So I want a small and easy to maintain place.  Still hoping for a bit of privacy if possible.

 

 

You said you are ethnic Thai but US citizen. Does Thailand allow dual citizenships?

 

If not, you're considered a US citizen and not Thai citizen.

And you can't buy land because of this.

 

Edited January 11, 2017 by EricTh

[mania]

1 hour ago, EricTh said:

 

You said you are ethnic Thai but US citizen. Does Thailand allow dual citizenships?

 

If not, you're considered a US citizen and not Thai citizen.

And you can't buy land because of this.

 

 

That is an old myth that was passed around,.

 

Being a dual citizen does not affect the fact your a Thai & does not limit your

ability to own land nor have any other Thai citizen rights.

 

 

[up-country_sinclair]

14 hours ago, sfokevin said:

I found a nice older house in a exclusive mubaan it needed a lot of work  but the rent is 15k baht a month

 

14 hours ago, sfokevin said:

I spent about 300k redoing it.

 

14 hours ago, sfokevin said:

the Thai lady who owns it lives in Bangkok and is happy for me to stay forever!

 

Of course she wants you to stay forever.

[BayLay]

Thanks again everyone.  You give me a lot more to think about.  We may end up going back earlier than 5 years, so this is all very helpful.

 

now on to clarifying questions, answers, and comments:

 

22 hours ago, StefanBBK said:

Take your time. 5-6M will eventually get you something nice.
Renting is ok for short term. On the long run its a losing proposition.

Why do you feel renting is a losing proposition in the long run?  Not challenging your statement.  I just want to understand your perspective.

 

21 hours ago, lkn said:

 

I think the issue might be this: “Grocery stores and a couple of casual restaurants within walking distance” — western style restaurants and grocery stores are not easily found outside the central city, but a 186 m² house in the central city does not come cheap.

 

If you can settle with semi-walking distance to something like Kad Farang then I think there should be plenty of options.

 

You are exactly right.  Walkability is one of the key considerations.  But semi-walking might be doable.  So I'll check Kad Farsaeng area.  Thanks for the trip.

 

20 hours ago, puukao said:

after a few years of death pollution you will be happy you can leave....especially coming from either WI, MN, IA, NE, wherever......this air quality will kill you.  i wish i was joking.  google it...

(Snip)

soon the traffic will be crazy and the noise will be insane.

(Snip)

I would start by 6 months in CM and 6 months back in America... 

Your comment almost made me cancel my plan.  But then when I was scraping the ice off my car this evening, I think 6 months here and 6 months there may be a really good start...

[BayLay]

22 hours ago, what2do said:

Well is the Thai culture focus on owning as higher social status than renting? 

Unfortunately, the answer is YES.  But I don't need the higher social status, especially when it doesn't make sense.

 

16 hours ago, luther said:

Perfect arguement for renting.

 

Almost everyone I know who has lived here for more than a couple years rents a house. Most live in fabulous houses with great landlords willing to put up money towards improvements in return for stable, caring renters. Outside the city, most of these folks pay 10 – 20 K baht per month. Almost all of these people rented something decent for a year or two and then found something great. It's the way to go especially if you don't want to live in a cookie cutter moobaan.

That sounds tempting.... 

[LivinLOS]

1 hour ago, BayLay said:

Why do you feel renting is a losing proposition in the long run?  Not challenging your statement.  I just want to understand your perspective.

 

Theres many reasons to rent.. Theres very few to buy, but those are compelling.. People have a strong desire to own and control thier own space, renting leaves people feeling at anothers control which isnt nice. 

 

1) selling is very difficult.. I have seen an initial 9 million home asking price end up a hair over 2 million sold. My last home went from 12.5 mil to 7 when I offered 5.. Now its sat a year and a bit, I wouldnt offer more than maybe 3.5. Leading into point 2

 

2) homes here are often badly built.. I leased a 30 plus milllion baht villa on Phuket (10 years ago prices.. +50% now down there ??) and when a retaining wall gave it way the house was 25m down the cliff in a landslide.. Insurance failed to pay the western owner BTW. My last house was gradually crumbling, the cost of maintenance was approaching the amount of rent I was paying, this is a common theme in houses I have lived in, the owner was basically spending my rent money, just to stop the house decaying, pool cracking, foundations subsiding, etc etc (In part this is bacuse I have rented homes, Thais dont know how to build.. Your average little 150 sqm bunglow rarely seems to collapse)  A really well built home wont or at least shouldnt do this, but even then, termites, sun damage, cheap materials and shortcuts.. Houses seem to crumble here faster than I have seen even in North Africa. 

 

3) land has value and appreciates, houses depreciate.. Combining the above, adding in Thai access to good materials, fixtures and fittings, etc etc has been changing massively in last 2 decades and continues to do so.. Means on average a home is going down in value not up, newer is better, The land it sits on however, can be rising in ways I feel are not sustainable, so I sense an over valued market anyway currently. 

 

4) there is no zoning or control, unless you are entirely built out around you, what is wonderful today is a nightmare tomorrow.. If it is built out around you, a karaoke can open, your neighbour can get roosters, or a drunk move in who plays deafening noise all night. These issues are rarely fixable.. Thai society seems to just accept other people causing discomfort, people with power or connections get away with doing anything. Same topic means the new moobaan with the lovely swimming pool and well maintained common areas and good security, can be 2 years away from a slum with ripped garbage bags pilled on the corner, packs of feral soi dogs, and a green pool or constantly raised fees being pocketed by the buddy the developed installed as the moobaan management. Again you cant fix this, its happened on what should have been great moobaans I have lived (go look at Karnkanok 1 and compare it to 5 years ago.. Go look at the mansions in Chaing Mai lakeland, next to decay on the next plot). Once the moobaan is all sold, the extraction of resources and reduction in services is simply a timeline. 

 

5) in the price bracket your talking, theres 100s if not 1000s to look at.. Now you can write off over 90% as being flawed in some way, but theres still a lot out there. With time, you can find a superb rental thats in that price range (more in a sec) if it stops being superb, you can find another. When you own you cant.. See point 1. 

 

6) houses seem to attract terrible rental yields, because of this must own Thai (and western) mindset, because you can easily sell them, because of so many reasons.. Over the years I have never paid 5% of the houses perceived sales value and sometimes been down at 2% of its value. Thats before the repair bills too BTW. 

 

So the issues of freedom, flexibility, ability to handle change, both your own and the environments are all in rent. The few parts that lead to buy hinge on emotional connections, ability to feel free to do what you wish (a good landlord and willing to put back anything you change often solves this) and the idea of 'dead money' in rent. 

 

One place, where in the chaing mai market I do understand buying (or building) is quality. With everything said above, its highly likely I will still build, because what I want to live in simply isnt on the local market at sub 25 mil sale price (yet could be built easily for half that) and those homes rarely rent at anything like the same cost balance as 'normal homes' this is different on Phuket where high quality fixtures and fittings, interior design, garden design, pools hot tubs and saunas etc etc do exist in the rental market. What chiang mai lacks in the rental market is quality IMO. Not just the villa end, the >500sqm places, but even small quality fixtures and fittings are very few and far between. Average moobaan homes, 1000s of em, and with careful furnishing, some cheap changes to fixtures can be made decent enough, but turnkey luxury places I couldnt find. 

 

TL;DR.. Rent

Edited January 12, 2017 by LivinLOS

[BayLay]

38 minutes ago, LivinLOS said:

So the issues of freedom, flexibility, ability to handle change, both your own and the environments are all in rent. The few parts that lead to buy hinge on emotional connections, ability to feel free to do what you wish (a good landlord and willing to put back anything you change often solves this) and the idea of 'dead money' in rent. 

 

One place, where in the chaing mai market I do understand buying (or building) is quality.

TL;DR.. Rent

Thank you so much for your thoughtful and comprehensive reply.  I really appreciate your taking the time.  And I totally agree with you on all points.

Next time I visit, I will check out the rental market, and may even look further into building if I decide I like life in CNX enough.