Buying a condo in Bangkok is the second-best decision I’ve made in my life. The best decision was to travel to Thailand in the first place. Since coming here my lifestyle has changed dramatically and to leave would be absurd. Fortunately, I never have to. When I first bit the bullet and put a down payment on the condo I had been travelling back and forth to Bangkok for close to 5 years. It was the only smart option to make the move more permanent. Now 5 years later my condo has gained 30%+ in value and I’ve enjoyed many rent-free years. I love the lifestyle, security and options I now have while living here. Here is my experience and guide to buying a condo in Bangkok.
Buying a Condo in Bangkok (Financial Crisis 2008)
In 2008 I bought a one-bedroom condominium in the Sukhumvit area of Bangkok. The property was ‘off plan’ meaning construction hadn’t yet started with better prices but of course higher risk. Using the help of Google and guidance from my agent Koong at Acute Realty the processes for buying a condo in Bangkok were simple. Again I can’t recommend Koong more highly, she was amazing and I owe a lot to her help, however having now left the company my more recent experiences with the company have been little better than useless (check bottom for realtor).
I never once considered legal advice and rarely worried about my investment. I was buying a condo in Bangkok with one of Thailand’s leading high-end developers Major Development PCL. That being said when I bought a condo it wasn’t the best of times as I found when the 2008 financial crisis hits (known in Thailand as the Burger Crisis as it originates in the US). At this stage I had paid close to 33% of the final condo price. Worries crept in as global trading slowed along with construction progress and deadlines.
At the time, other big property players like Raimon Land (The River) were now in question with their finances tied up in the now-bankrupt Lehman Brothers. Major Development (and my condo) were at the same time partly financed by AIG and they were also on the brink of collapse only to be bailed out last minute by the US Government.
But in March 2009 Major Development completed the project. At the time I was reassured that finance was available regardless of AIGs fate (possibly to ensure payments continued and the project stayed alive). I was buying a condo in Bangkok during the riskiest of times and would happily do it again. I now live in luxury in Bangkok while similar money in the UK would have bought me… nothing really.
Managing Exchange Rates
During the financial crisis, the British Pound (GBP) was hammered and within weeks exchange rates dropped against the Baht (THB) from 1:70 to under 1:50. When I made full payment (the final 67%) exchange rates sat at 1:52. It cost more than expected but I was happy to pay. I never considered hedging such a small investment as extreme circumstances would never have been predicted. At the time I always had the option to flip and profit from the initial 33% investment but my reasons for buying a condo in Bangkok was not for financial gain. My only goal was to live in Bangkok. I held onto the condo, paid off my small mortgage (in the UK) and in May 2011 moved to Bangkok, debt-free and rent-free. All worked out well.
Buying a Condo in Bangkok from Outside Thailand
With a little help from my friends, I didn’t need to be in Bangkok until the final transfer date. I had someone make reservations, I sent documents by mail, made international money transfers and had someone else make inspections. If you expect others to do your work you will need to give them power of attorney (written authorisation to represent you). If you have no one to assign in Thailand your agent may accept this role. You should be there in person for transfer of the condominium unit. Click here for full information on foreigner ownership for buying a condo in Bangkok.
The Process of Buying a Condo in Bangkok (Off Plan)
When making reservation you will pay a small fee (e.g. 30,000). The agreement will then be prepared (English and Thai) and signed by both parties – the buyer and the developer (by post if necessary). On signing the agreement the buyer pays a percentage of the price (e.g. 10%). The agreement sets out a schedule for payments and a transfer date. Payments will be made to complete a further percentage (e.g. 20%) and these will be paid monthly (e.g. over 15 months). If the development takes longer than set out in the Agreement a small percentage will be deducted from final price. All receipts of payment will be recorded by the developers and a copy mailed to the buyer (very important). The final payment is completed at the transfer date. A one off sinking fund will be included (reserved for maintenance or replacements) as will up front maintenance fees.
Buying a Condo in Bangkok for Leasing
You will need a Thai Bank account. It is hard to send money out of Thailand and not having one puts off potential tenants. This will need to be set up in Bangkok. Siam Commercial Bank and Bangkok are two of the bigger banks to consider. To open an account you will need to show your condo ownership deeds.
What About Bills?
As co-owner of the building and facilities, you will have joint responsibility for general upkeep e.g. cleaning, security wages, management services etc. You will therefore need to pay CAM fees (Common Area Maintenance). These are often paid annually or half-yearly. The fee is calculated as budgeted cost per square meter for the given period (total costs / total sqm). This is distributed evenly between co-owners depending on the condo unit size e.g. 50 sqm x 50 baht = 2,500 baht per month. This maybe be billed 30,000 per annum (x12). Bills for electricity, internet etc. are not normally handled by condo management and will arrive monthly to your mail box to be easily paid at a the 7/11. If you fail to pay for electricity you are likely to be cut off. Water is paid to the condo management. Check here for our full Guide to Living in Bangkok.
Furnishing the Condo
After buying a condo in Bangkok you will need to furnish it. If you have time, a decent budget and a flair for design the best place for furniture is Crystal Design Center (Lad Prao). For unique and interesting Thai pieces try JJ Mall and Chatuchak market. If you prefer to do it quick and cheap try MBK, 5th floor which includes the two large furniture outlets Index Living Mall and SB Furniture. There is also an Ikea (Bangna area). For bits and bobs such as light bulbs go to Tesco / Lotus.
Problems after Buying a Condo in Bangkok
Once the inspection has taken place and ownership transferred all problems inside your condo unit are your problems. The management team have no responsibility other than common areas. Therefore inspection is very important before transfer. One problem I am currently looking into is the responsibility for damage caused after the transfer had taken place. In my case the plastic seal from a window in the empty condo above was loose, hanging down and blowing against my window. This occurred for months while I was not there and left deep scratches across my window. Not an easy problem to fix and after bringing it to the Condo management I was told my condo was outside the original 2 year guarantee. I am still uncertain of this.
Leasing and Property Agents
In early 2015 we embarked on new and exciting adventures meaning the condo would have been left empty for pretty much all of the year. As much as we didn’t want to lease the condo, it was the smart option to use it for income. So from our previous experience with Acute Realty, we put our faith again in them which was very wrong. Not only did it take 22 stressful days to list the property but in 3 months they failed to turn up to take new photos as said, or find any interest whatsoever. The feeling was that this could go on for many more months with not one potential tenant. Therefore I would like to offer my sincerest apologies to the 2,209 people who clicked through from my site to them in the past and received similar enthusiasm. So after two weeks of nothing I realize putting my eggs in the one, uninterested, basket would be futile and instead I went to free listing websites such as DD Property and Prakard (Now DD Property) to get things started and I also ask the condo management to forward passing agents to me. This is when things started happening. New tenants were interested at least a couple of times a week and in just under 2 months I accept a new tenant on a yield of around 6% of current value including 6 months up front payment from abroad. I’m happy with that. The agency who sourced the tenant was a new, lesser-known company called Shambala Realty and more recently a small real estate company called DP-Services. To sum up the experience, I found that the well-known companies were complacent while the independent and unknown agencies had a bit of hustle and interest about them. They really work for their money. I wish I could share them all but most contact was by phone so I never got their websites or company names. Although another which I did get help and info from was The Residence Rental. Note, the agent fee is the same with all (1 month rental fee) and they will continue to work as an in between for future dealings with the tenant. All worked well in the end after an idle and frustrating start.