Buying property in Bangkok as investment

[choonpon]

Sawaddee kha.

Does anyone know about property investment in Bangkok as at this day? Is it worth buying as investment, renting out for rental income at the same time?

Any information will be much appreciated.

Krob khun kha and chok dee na

[Asian Hand]

Don't expect a major return on your money by investing in new residential properties in Bangkok. Similarly the liquidity in the secondary residential realestate market is very low. Once rates exceeded 100,000 THB/sqm the days of buying and flipping condos at a profit have passed. Condo's continue to be built at uncontrollable rates and when complete are unoccupied. Simply travel along the BTS at night and note that lack of lights on in all the newly completed condo projects. Low occupany equals insufficient maintenance fees equals building deterioration. Similarly, rental yields need to be in the range of 7% to make it worthwhile and those are scarce. However, if you are not hung up on buying a used/second hand house or older condo - opportunities do exist to do some upgrades and get proper rental yields. There are many properties for sale in 10 year old+ buildings at rates of 35,000 to 50,000 THB/sqm and at sizes larger than the phone booth types now being built. But it does depend on location and you do need to make sure the building has been maintained properly. Nevertheless, don't expect to flip such properties at a profit and rather enjoy the rental income.

[Sci-nerd]

I agree with "Asian Hand".
Use extreme caution buying property in Bangkok at the moment. Especially the Condominium market can very well be inflated beyond.

Deterioration is a big issue. Do not expect to have the same value of a condo after 10 years, since buildings tend to downgrade in price with age - faster than the relative market value increase.

Renting out your property can be a relative safe investment, if the alternative is money in the bank (where interest rates are only 0-3%). Other options would be the stock and bond markets, with yields in range of 3-10% annually. But as always you have a risk with stocks as well as some bonds.

Renting should give you a total "payback" time of 8-10 years. Unfortunately it can be difficult (and expensive) to rent out property, and you can never be sure to have 100% full time contracts.

But like mentioned - it is usually better than keeping the money in the bank. But be careful to chose the right property. And you must exercise a skill not custom to many Thais: The skill of negotiation. Never pay full price for property - always hackle and negotiate - sometimes to extremes. Most property for sale in Bangkok right now is "hot" property. The sellers are usually very eager to sell.

[drake65]

Investing in property business can be beneficial. The best idea is to invest in rental house instead of commercial or domestic property.