A Beginner's Guide to Choosing the Perfect Buy-To-Rent Condominium in Bangkok
During the period when interest rates on deposits are very low, it may be the best time to consider investing in rental property. But while lucrative, renting out condo or house can be time-consuming to manage yourself.
Not just a source of passive income, there are many other benefits that come with owning rental property, such as a condominium. But, before you decide to buy a condo for investment, you need to suss out all the information to find the right property that fits your needs and gives you the most value for money possible.
It would be an advantage to choose a condominium for sale located in the heart of the city, one within walking distance to the subway or skytrain, near major shopping malls with groceries, specialty stores and other services like banking as well as near international schools, hospitals and parks (because these will be convenient for prospective tenants). Next, you need to define your target tenant. If you plan to rent out your condo to a foreigner, it is essential you consider demand and supply in the market, in addition to understanding who you are trying to actually attract. Is your property suited to a student, professional or family? If you want to rent out your condo for 1 to 2 years to a young, working expat, refer to a spare room as ‘office space’ rather than ‘nursery room’.
Your potential tenant will feel valued and supported if you sharpen your focus on their needs and wants. Then, you will need to determine how much you should charge for rent. The rental budgets of expats are often set by their employers. So how can you reach this group of customers?
The answer to this question is to hire a brokerage or agent who takes care of foreign companies, international government organization, or embassies.
Foreign staff of these companies and organizations often choose centrally located accommodation with convenient commutes and easy access to the skytrain, subway or other public transport as well as those close to shopping malls and other facilities, such as international schools, hospitals, parks, etc. These tenant types usually have a central budget divided by the number of bedrooms, for example:
Example of budget is:
1 bedroom - rental around THB 30,000 - 50,000
2 bedrooms - rental around THB 60,000 -75,000
3 bedrooms - rental around THB 80,000 - 120,000
If you want to attract a group of tenants with a budget of THB 40,000 per month, you must buy a condominium with a compensation of not less than 4%, which will allow us to know how much we should spend to buy a condominium.
A simple calculation is that income of THB 40,000 per month will be equal to THB 480,000 per year. If compensation is not less than 4%, the purchase budget will be at THB 11 million.
What Types of Condos for Rent Tenants Look For?
After we set a budget, it is necessary to consider the appropriate and desired condominium. For example, the room size must not be too small, such as a one bedroom whose area must not be less than 45 - 55 square meters. Also, the living room and bedroom should be separated, and there should be a kitchen that is accommodating to cooking because most of the long-term tenants rent condo for about a year or so.
Condominiums for rent can be in a high- or low-rise building, depending on whether or not there is a good view. If the view is worthy, it may be easier to rent. If choosing a condominium with 1 or 2 bedrooms, it is recommended to have furniture ready for living. It will also be more desirable, if there is more than the standard furniture and also provide additional decorations, such as beddings / linens, complete electrical appliances, etc.
Finding the right tenant for your hard-earned property is easy with a trusted brokerage agency that is competent and well-equipped. CBRE Residential Leasing can make the entire rental process hassle-free for both owners and tenants. You can count on us for accurate, practical advice based on our many years of experience. Very simply put, we just make renting easier.
A summary of good techniques for renting is as follows:
- Research to find the right property that fits your needs and gives you the most value.
- Calculate how much rent is suitable to be able to set up a budget for purchasing.
- Ensure the location is suitable to meet the needs and desires in / of the rental market.
- Familiarize yourself with characteristics of the building, floorplan, and view
- Determine what is the most suitable room size in the long run.
Renting out a condominium is a long-term investment that could keep an asset's value stable without deterioration and allow owners to earn a return with low risk. But like any investment, there are many responsibilities. If your rental property is outside your country / city of residence, your portfolio has grown beyond your ability to manage, or you simply want to unburden yourself from all the complexities involved in renting out property, then it is well worth it to consider hiring a company that specializes in all aspects of the rental process - from start to finish.
CBRE’s Residential Leasing team of experienced negotiators who have excellent knowledge of the market and offer a full range of services, in addition to integrity and honesty in all our dealings, is one of the main reasons why you should rent out / rent your home through CBRE.