Put the Right Price Tag on your Condo for Rent
There are plenty of issues that you must deal with before you can have your condo rented. From Thai laws to the choice of tenant, all of these are crucial in creating a successful transaction. But one of the most important factors next to the condo itself is the rental price that you have to charge the tenant.
Is the market ready for your set price? What other costs would you include apart from the rent? What constitutes a fair rent? How much price tag should you attach to your Bangkok condo for rent after all?
There are a variety of ways that you can follow to set a realistic price for your Bangkok condo for rent. Here are some of them:
How to put the correct price
1. The most common way is to browse the classified ads of leading dailies, property search websites and property management companies’ list to search for similar Bangkok condos for rent. You may wish to call the numbers on each ad to verify if the owners are willing to negotiate with the set price. The market rate is always an indicator of the general trend of rent. However, you need to be careful with your research since your data may be biased with a select group of condos for rent.
2. If you can search for similar condo units that are rented in the same building where your condo is located, you may ask about the prices that the tenants are paying for. Of course, you have to approach these folks with a warm and friendly attitude otherwise, they’d think you’re a representative of a market research firm who’s only performing cold calls. Introduce yourself and tell them that you live next door and you’re planning to have your unit rented.
3. Is your condo unit furnished? If it is, then it’s reasonable to adjust the rent a bit higher than those bare units only if the furnishings are good enough. That is, appliances must still be in working condition while the beds, couches and other furnishings must still have good quality. You can raise your rental rate by 12 to 14 percent depending on the quality and number of furnishings that you wish to include.
4. Consider the location of the condo as well. Is the condo building located in a prime location where shopping centers, schools and workplaces are highly accessible? Is it located on a higher floor of the building? Is it close to public modes of transportations such as the BTS Skytrain? If your answer is “yes” to any of these questions, then you have the opportunity to raise the rental rate of the condo unit. When an inquiry is determined to be an urgent move-in, then you can certainly bag the deal.
5. How about the amenities in the condo building? Will the renter be able to take advantage of using the fitness gym, swimming pool, recreation deck, tennis courts, etc.? If so, then you can command a higher rental price since they can obviously save on the costs of enrolling in fitness facilities outside the building.
6. Bangkok condos are usually rented out for more than 12 months. If it is shorter than this period, owners usually advise clients to search for serviced apartments instead. However, there are few condo owners who are willing to offer their rental units in as short as eight, six or even three months. If you are one of these, think about the earnings you’ll get when you have your Bangkok condo rented so you can have at least a positive cash flow during this period.
7. If there are similar condos in the same building or nearby high rises, treat them as your competition. If you want to have your unit rented out as fast as possible, you can lower your rental rate compared to other equally appealing Bangkok condos. Just make sure that you’re not on the losing end in this transaction.
8. Finally, think about the return on investment that you would get after computing for the cost of purchasing, maintaining and renovating the unit. Take note of your mortgage payments, real estate insurance, property taxes, condo management fees, etc. when determining how much your break-even rental income must be. After which, you can add the rental profit that you would like to receive from the tenant, with some adjustments on a realistically acceptable market price of course.
To give you an idea of the current Bangkok condo for rent rates, the Bangkok Condo Finder research team has come up with this latest survey:
Bangkok Condo for Rent Rates as of 2Q 2011
Rental Rates per sq. m.
415 – 425
347 – 351
355 – 362
328 – 334
361 – 368
Take note though that these numbers are for information purposes only. You need to conduct your own survey using the methods above to determine the right rental rate for your Bangkok condo.