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Hi all,
Has anybody ever tried to venture out and invest in Thailand?
I have a new 2 bedroom apartment being built at the moment in Phuket....no it wasn’t affected by the Tsunami, it was at least 500metres away...
I will have to check on the rental situation since the disaster, but before it, I have been told that for a 2 bedroom apartment like mine (70m²) could bring in around 35000 - 50000 Baht a month, which is around £470 - £675 pcm. Now the expat mates of mine who live there are saying it’s not uncommon for these sorts of rents to be achieved, but I have to wait until I have a tenant in place. See for myself...
I bought the property for around £38000. The prices have gone up since then, but they are still cheaper than back in the U.K.....and.....it’s in paradise!
If this rental achievement is accurate, I will let you all know, maybe some of you could think about investing there?
I am over there quite a lot, what with the apartment and visiting my other half! Maybe I could provide some sort of service, looking at properties for the interested.....for a price like....just a thought!
Anybody else out there had any experiences?
Problem being though is that the U.K will not finance you to buy in Thailand, it will happen I'm sure...but until then...anybody have any ideas or ways of lending money for this??
Regards
Simon
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Hi Simon
Sounds very interesting. Are you planning to rent it out to locals / expats / tourists? From what you've said it sounds like you'll be planning to get all-year-round occupation - which makes a massive difference to ROI.
I'd be really interested in how you get on. How did you source it btw? Would you potentially be offering to source similar projects for others? I assume your local friends have helped with the rules & regs (are there many?).
Please let me know how it goes!
cheers
Will |
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Hi Will,
This could be a long email.
I'll be renting out to expats, as the price is too steep for Thais. I'll be looking for year long rentals.
The holiday rental market is just too much hard work too.
Ensuring the apartment was cleaned and sheets changed maybe every two or three weeks....just sounds a nightmare without going into it in detail.
Also, if you go for holiday rentals, you would probably only get half to two thirds rent for the year, as it is monsoon from around May till October. Phuket isn't totally soaked the whole time, possibly July & August are quite wet, in May for example it rains around about 3.30pm - 4pm and only for about an hour. Its still enjoyable for tourists but tourists want 100% sunshine or else their holiday is ruined, I know I used to go to Spain and think my holiday was ruined when it rained for twenty minutes!!
The problem with tourists is, they will read that it is the wet season and will not come, so it may stand empty for a few months.
The expat mates of mine have said many times people have walked up the hill where mine is being built and asked if anything is for rent! So hopefully they are right. People have said the rental market is strong there.
A letting agent, who hasnt seen the apartment, but has been explained to him did a comparable with other apartments of approximately the same size and amount of facilities and he has said between 50000 and 60000 Baht (£675 - £810), but I think that could be too much, so I air on the side of caution and expect only about £500...possibly only £450 which is still around 14% yield, but as I said before, I'll let you know, when I get tenants!
Its funny how I come by it really. I bumped into an Aussie lad on his travels in Bangkok, we got on well, so we met up in Phuket. After I had left he bumped into an old work colleague of his from Oz. She was actually sat with an Englishman (Geordie) who had retired out there. My mate got chatting to him and it turned out he was having apartments built in Phuket. My mate had heard me go on about buying property somewhere and put me in touch with him.
On my next visit to see our lass, I looked him up and ended up buying one!
The rules and regs are quite confusing. Its all about land and ownership of land. Basically, you or I cannot own land in Thailand. We can only lease property which stands on the land, for 30 years with an extended 30 years afterwards.
You or I can OWN a condiminium, which out of the whole block a percentage of I think 51% must be owned by Thai nationals.
There are ways around these things, which I have found...it may sound dodgy but seems completely legal.
You set up your own company...you may have heard this for Bulgaria or other such places...you become the director of this company. You must employ Thais to work for this comapany. These Thais basically sign one form to say they work for you and the other one which gives them redundancy. Therefore leaving yourself as the sole director of a company with no employees!
Hence the company can own land and build on it, but as you're the sole director of this company you basically own it, just not in name....your comanys name!
There are other things to think about but I think I'll jam the server. Sorry guys!
I'm sure if I got myself organised I could do some sort of property sourcing yes, its definitely something I have been thinking about.
Anyway, if youre not bored of this already, unbelievable!hah
Cheers
Simon
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Interesting Simon.
Would income be in bhat? Have you tracked the exchange rate exposure at all? I remember them suffering in '97 when the whole of SE Asia tanked. I'm pretty sure it's recovered, but this will need to be taken into consideration I guess.
Also, are there repatriation issues with the capital sum if you wanted to withdraw it (it being a Thai co.)?
Yield looks good though! And there are worse places to be left with a property!!
cheers
Will
PS how much are flights out there? |
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Hi Will,
Income would be in Baht yes. But its very simple to set up a Thai bank account. You could also set up a foreign currency account like I have, then you can decide when you want your pounds turned into Baht...at the best time!
Also, you get a cash card and can take money out of your cash points over in the U.K. The exchange rates between the banks I have found quite decent.
The exchange rate between the Baht and the pound has steadied itself and fluctuates between 72 and 75 Baht/£. I think the economy is a lot more settled than before, such as ´97 and speaking to Thais, they reckon Taksin Shinawatra (Thai Prime Minister) is pretty good.
When you send your money over there, you have to sign a form to say you brought this money in from outside Thailand.
So, if for whatever reason, you sell up and take the money out, there won't be any questions asked about where it came from. Not that sure about the company side of things as I havent gone down that route yet, but I could find out next time I'm over!
Flights can vary. I travel from Frankfurt, as thats where I'm based at the moment and can get a flight for(depending on peak or low season of course)roughly £400 return. That is stopping in Muscat and Bahrain on the different legs of the journey.
Yields sound good, but as I said before, I'll decide if theyre good when I get tenants in...fingers & everything else crossed!
Cheers
Simon |
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Hi guys,
I have visited a fair bit of Thailand. Pattaya is by far the most commercial, without question, but the surrounding area could prove a good investment.
I would say the expats in the area never rent, not a lot of point when you can buy a 3 bed house 10 minutes from the centre for £25,000.
You can buy ocean view appartments, of course, these going for simpilar prices. Again, almost all expats or pimps. Normally a combination of the both!
In that area, a good tenant would have to be working girl with plenty of Western boyfriends. Many Westerners have a handful of them: they come cheap and look nice on the arm.
Basically they pay the girls pocket money (which is terrific money for the Thais) and a girl with several income streams is a tenant who will pay good prices for downtown appartments since she will be in the high earner bracket of society.
I couldn't imagine what the property market on the islands is like, particularly after the recent tragedy on the west coast. I know that the eastern coast of Pattaya was totally unaffected.
Areas like the Rayong Province have a high expat population, lots of industry, communtable from Bangkok. Many Westerners have an appartment in Bangkok and Rayong, Bangkok for the weekends. I would suggest that with land and labour so cheap, there some good profits to be made here.
Dan |
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these 5 posts could fill a book!
interesting stuff by the way ..
tom |
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it's like a rough guide to SE Asia!
some interesting stuff here.
are there any websites for thai property i wonder?
mark |
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This isn't a bad place to start mark, some interesting reading here:
http://th-property.com/Thai_property_law.asp
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Simon: "You set up your own company...you may have heard this for Bulgaria or other such places...you become the director of this company. You must employ Thais to work for this comapany."
Dan: "In that area, a good tenant would have to be working girl with plenty of Western boyfriends."
there's the basis for a business plan here somewhere!!
John |
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Hah hah yeah....not sure our Mam would speak to me again if I became a pimp!!
I'm only interested in Phuket and the islands really, as there are still retirees out there that want to only rent, or there are expats living there, but not sure if they want to stay and so only rent. The market is still pretty good, but the Tsunami has dampened it a bit....for a few months anyway!
I'm planning on living there soon, so, to have property there that I could manage myself is better for me!
The beaches are better in Phuket than Pattaya anyway....even after the Tsunami....cleaner in some areas as they have cleaned up after it!!
LOCATION! LOCATION! LOCATION!
Moss side compared with Windsor!
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What's internet access like in Thailand, Simon?
Will |
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Internet is accessed all over Thailand.
My girlfriend lives in Nakhonratchasima(Korat) and sometimes Khon Kaen, I have had no problem getting Internet access and these are not tourist destinations.
The Thai school kids are in there all the time playing on-line games. Sometimes you cant get on a computer for kids playing on them all.
Its quite funny though, you see the teacher coming down to drag them all out of the internet cafe at lunch time.
Its so cheap in the remote areas and I think I was paying 15Baht an hour in Khon Kaen...which is hardly worth converting when you think its about 72Baht/£.
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Hey nice one Will. Thanks for that info.
Its as I thought. My mates who live in Phuket say its a little quiet (tourist wise)but rentals are still quite strong. He knows of an ex-pat who has just rented out all his properties on long term rentals, so its promising to hear this news.
I was a little worried as its a lot of money, for me, to lose because of an act of God, but I knew that it would pick up again, it HAS to! Its what Phuket has to survive....tourism!
I'll be out there in April to furnish my apartment and hopefully obtain a tenant.
Cheers Will
Simon |
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Hi all,
Well Ive eventually got the apartment finished for those of you that remember. I know this is an old thread and strictly speaking should be in the Overseas part...but!
Here is a link to the finished article. You can see what you can get for your money in Patong/Phuket when you see this.
http://www.siamrealestate.com/property/propage.php?n=949
When speaking to the many ex-pats out there who are building or just buying, they say the market for long term rentals has not suffered as much as we all thought.
Mine probably wont rent at the moment as its coming into the wet season, it tends to be slow in the next month or three.
In fact while I was there there seemed to be a lot of buyers wandering about.
Anyway, well see how it goes. Ill keep you posted.
Cheers
Simon |
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simon,
well done on this and thanks for the up date. i can't believe how cheap it is!!
tom |
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Cheers Tom.
There are cheaper ones in Thailand but Phuket being the main destination for tourists, it gets better capital growth and as you can see the yields are pretty good, as long as it rents out like.
I have found some financial deals available in Thailand now, offering 50% and 60% LTV. Worth a thought. Have a look at this link below
www.belairpanwa.com
Cheers
Simon |
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That looks really sweet, Simon.
Was that with the £25k mortgage you were talking about? Amazing value at 5 times the price!
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No, I took the equity out of my place in Manchester and bought it. Not a great use of my money but noone would lend to buy in Thailand at that time.
Since then,finance deals can be found, but only for specific developments! Shame! |
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"not a great use of money" - why mate? Capital appreciation's few and far between over here - no idea of the market in Thailand, but you're as likely to be better off there, tsunamis notwithstanding...
Good luck with it all - let us know when she rents!
John |
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Well, what I mean is, the £38K I spent over there could have got me 4 or 5 high yielding properties in Scotland.
But at least I have a foot in the door over there, as thats where Im intending to live.
I'm on the lookout for a couple more places out there but could really do with a finance deal. But they are very few and far between.
Will keep you informed as to how the rental goes.
Cheers
Simon |
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Good on you Simon!
I've on enjoyed this thread. By the way I loving my new holiday pad in the South of France - in fact I think Ill be spending more time a year there than the UK.
Also - Scotland is the way forward at the mo. Where are you buying?
The Daddy |
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Cheers DL.
At the moment a couple of flats have fallen through, they were in Falkirk and Motherwell. Problems with AST's and the tenants that were living there, DSS, I myself havent a problem with them but the lenders do I'm afraid. So they pulled the funds at a very late stage.
But I have a few more on the way, in Easterhouse and in Hamilton. I was looking at Aberdeen in Torry but they are going for a lot more than the O/O price, like 20% - 30% over. That doesnt fit in with my 10% yield target. So I reckon these are now past the 3pm in the clock....if I understand it right like!
I would do the same if I could, I would spend my time in my holiday retreat and check on things back home using the internet. I have a way to go before that happens though.
Regards
Simon |
