What happened to Onnut Condo Rental prices

I have lived in Bangkok for the best part of 14 years and during that time have watched in awe as Onnut has grown, not just in terms of its popularity as a choice spot to look for your Bangkok condo rental deal, but in terms of how prices have shot up.

Time fly’s by so fast these days that I often forget maybe 5 or 6 years have passed since I last really looked at rental prices in Onnut. I was once very seriously considering it myself as a place to live, based on it being such a nice area, convenient for Tesco and Big C and of course the BTS line.

But now I look again with even more sincerity and I see a 2 bed Onnut Condo for rent at 28,000, higher than where I live right now in the Nana to Asoke strip, which was has historically always been a more expensive area. That said, let us be honest and state for the record that in this case it is in fact a Sansiri development.

So I look again and find a truly delightful one bedroom condo rental at 16,000 and again I think to myself, that is way over the top for Onnut condos. But it is no longer the case, this is I see now the going rate. Great place for a single dude or perhaps even a couple, but not for me as it is way over my budget with wife and kids.

It looks as if my search for a new Bangkok condo rental will continue just a little longer. How is yours going? Written by David Smith of Siam Distinction (http://www.siamdistinction.com/)

Is Ari the new Thong Lor?

Distinctly different for sure, but there are some undeniable similarities in that some of the nearby malls, restaurants, super-markets and such like are very similar to those found in Sukhumvit Soi 55, right in the heart of Thong Lor.

Fuji, Tops Gourmet, brand name hospitals and private clinics, private bistro’s, café and whatnot, Ari has it seems all of the exact same ingredients and perhaps more as its illustrious cousin. Yet you can still come around here and rent a condo for a substantially lower price.

Take this 2 bed, 2 bath, executive condo, found very close to BTS Sanam Pao. It maybe a little older than a new Noble or Sansiri condo but it offers great quality of life within a short hop to anyone of the aforementioned amenities whilst also offering 78sqm of living space, nice pool and gym, all in a nice green and quiet setting.

How much would pay for such a Bangkok Condo rental? Normally if in Thong Lor I suspect around 30-35K per month, yet this owner is offering this property out at just 22K a month for long term tenants. So check out what it is you are looking for and need and where you want to be nearby to and you may just find you can slot yourself in to this condo rental nicely, s save yourself quite a few Baht I the process.

The future of the Bangkok Condo Rental market

I have been living and working in Thailand since 1998, many of those years working in the Bangkok condo rental and sales market for a great many of them. In those years I have seen a very clear downturn in rental values, or perhaps I should say in market demographics. No longer are the mid-range properties renting as they used to be. But why?

Ten years ago when I moved back to Bangkok after some time away, things had not changed much in the condo rental & sales market. Overseas buyers were still buying condos and renting them out and the norm of this was that they were buying condos for between 6 - 9 million Baht and then renting them at 35-50K per month. These were fairly easy to rent out back then as there was still a very healthy number of expats in well paid employment positions.

Today however there are less and less expats here in those high paid positions. As Thailand has developed, more and more Thai people are able to do the jobs themselves now, and normally they will be on lower salaries than the expats used to be. This of course means the market place of people looking to rent a condo for 35-50K a month has shrunk significantly.

In the more recent years this has shrunk again and now it is much less common to find many people looking over even 25K a month at all. This is not going to change any time soon, indeed it may never change as more and more Thai people become the rental clients for agents with budgets of between 6 and 15K a month in general. There are some occasions where people are indeed looking up to 25K as a working couple or family, but again this is becoming less and less common.

So looking to the future, this is going to be a continuing trend and until the average wage here reaches the needed levels, many of those 35-50K a month executive condos will remain empty or very hard to rent at best. As Bangkok continues to grow, as slowly as it is, into more and more significant business hub in SE Asia, the more and more Thai people will leave the countryside and move to city jobs.

With this influx of new clients comes a new influx of tenants to let your property to. But those clients will be the lower paid office workers, secretaries and similar perhaps on salaries of 15 – 25K a month and thus unlikely to be considering condos at much more and 8 or 9K per month.

The conclusion is that with this shift away from overpaid expats to the much lower paid indigenous population will come investors being well advised to buy the very small new condos now being built and sold at around 1.2m Baht. If previously you were thinking to buy a condo for 8 million and rent it for 45K a month, you would now be well advised to buy 7 condos at 1.2m Baht, each renting for around 7K per month. The income will be similar but more crucially your chances of having regular tenancy will have just increased many times over.

Buying a Condo in Bangkok for Investment

There is a great amount of debate on this subject right now and a great many opinions. Personally, as I will show in the next few articles in the coming week, opinions from any of us are likely as valid as any of those that come from the experts and commentators on this subject.

                             

I guess the first question should be, is the Bangkok condo sales market heading for a period of overheating, overbuilding oversupplying, call it what you will. Potentially yes, this is a danger for any such developing nation’s capital city and I have to say from my first hand experience there are a few red flags out there the could stop this bullish market.

To dive into this any further and in any great detail we would have to take each market sector as a totally separate market entity as from what I see they are all suffering slightly or very different fates. For example, right now the very low end of the market, say under 1.5m baht condos aimed at the indigenous market, seems to be doing very well and I see little evidence of swathes of empty rooms.

Not so for the medium and higher ends of the market. I will name no names, but in recent outings to towers in Thong Lor, Ekamai and Onnut I have found a great many rooms unsold and or unoccupied. In one new tower in Ekamai I have seen a range of condos on sale from around 4 Million to 20 million perhaps 60% sold only. Of the remaining ones sold hardly any had been rented.

And here lies a potential issue. I have found that a great many of these condos have been bought out by single investors who buy 10-20 at a time if not more. These units will often remain empty as the owners have no time not true intention or inclination to let their new condos out to the market, leaving some new towers perhaps 50% occupied or less.

Of course by holding them in this manner, they are falsifying the Bangkok Condo Rental stats as a whole, as perhaps thus encouraging further new developments to crop up and up as we feel there are not enough room available to fill the gap in supply. Should even 50% of these types come onto the rental market we could see an overstocked situation right away.

And here ends the first piece of guidance. Is the future Bangkok Condo rental market secure enough? Will you always be able to rent you condo for say 11 months a year minimum to gain the ROI you bought it for? Or will it as so many do, stay empty for at least a third of the year?

In my next piece I will write in more depth about the best sector of the rental market at present and how I believe it will evolve in the next few years and beyond.

What Floor is too Low for you?

When is a condo rental just not attractive to you? Too small, price too tall, messy, old, tired, smelly…there are many legitimate reasons I know. But in the case of a low floor in a low rise, is this so that it can be too low?

Walk up and down Soi Langsuan in the centre of Bangkok and find a 2 Bedroom condo rental under 40,000, go on I challenge you. Likely it is not going to happen if it is anything half decent in one of the developments on that street.

Now turn right at the top of Soi Langsuan into Thanon Sarasin…some nice little bistro type cafes and such like along there, and right opposite from Lumpini Park, so without question an awesome place to live. So what stops this 2 Bed Condo rental from becoming a 2 bed condo tenanted? 

 When I first went to see it, it was on the market at 45,000 per month and to be honest that did not strike me as way over board. However, try as we may it would not budge, so now we find it on the market asking just 37,500. Much more buzz and activity around the place but still, no takers.

Oddly it seems a condo can be considered as too low, in terms of the floor on which it sits. I could understand this if it was about passing traffic and pedestrian noise, but that would not be the case in this side street which is at best a ghost street. Further more having the pool, gym and steam room on the same floor just about 15 meters walk from your front door surely is of huge appeal no?

Take a look at the page on our website for this Bangkok Condo Rental that just wont shift! and if you see anything specific, drop us a comment below!

Bangkok Penthouse Rental at Silom Condo Price

Following on from yesterdays post about how rental rates have fallen here in recent years, I immediately thought of this as a perfect example of how the Bangkok condo Rental market has altered.

When you think penthouse you think, top floor, huge, lots of outdoor balcony and terrace space and a great area in which to live. Well, this penthouse in a Silom condo development certainly ticks all those boxes, and at a price normally associated with run of the mill 2 bedroom condos in any part of Bangkok.

It is indeed top floor; it takes up all the 21st floor of the tower development it occupies alongside the BTS sky train station. It is indeed huge, weighing in at 187sqm. It has many balconies and outdoor terrace, garden spaces with awesome views in all directions! And being in the heart of Silom and Sathon roads, it is indeed in a first class location.

 So at 60,000 a month, you would think it very well priced considering it comprises 3 – 4 bedrooms, 1 or 2 living rooms, 2 kitchens multiple bathrooms and so much balcony space yes? Now take a look at the agent advert for this Silom Penthouse and faint when you see it still available at the same price one would normally find a 2 bed condo for rent in Thong Lor!

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