Why Live In Thailand?

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Many people dream to have a life abroad and many have “made-it” to Thailand...and of course, why not? Thailand is a beautiful place to live and work...to enjoy your own personal pace of life and many other benefits. To be able to live your life with not too much financial worries, it is for many people, a safety-net to earn money in the local currency. Not everyone who visits Thailand works here, thus having to rely on their earnings from abroad; savings they make from work, past incomes from work, investments or pension.

With always the fluctuating currency exchange rates, relying on your previous savings, investment or pension this is not the most reliable way to account for your private financial bookkeeping, here in the Land of Smiles. Therefore it would be great if you could ‘generate’ a steady ‘domestic income’, or cash-flow, that does not suffer from a highly fluctuating currency market.

In SE-Asia (Thailand in particular) there is a very healthy and prosperous property-rental market. Especially when we focus on in Pattaya; we quickly come across a few essentials of which, one of them is probably most important: the LOCATION. This is because Pattaya neighbors the biggest seaport of Thailand called Leam Chabang. Almost worldwide, you will see a strong popularization of cities that are located in the vicinity of the country’s biggest seaport.

An almost ‘automatic’ attraction for industrial estates that belong in the genre of (international) warehousing, logistics, assembling-factories etc. Pattaya also offers an excellent infrastructure connecting Thailand’s metropolis Bangkok...

It is not a surprise that there is a strong (expat) rental-market here..As for the domestic market: a rental home is a suitable answer for those that cannot afford to buy a home and then there are of course the tourists that could be interested in a short-term rental property... (Beware that short-term lets require meticulous caring on the landlord’s part...) With that in mind, smart moneymakers are getting a chance at a profitable business opportunity.

Basically put, they simply invest on a residential property and have it rented by trusted and reliable tenants. It starts off with a clear research on the specific areas where the need for a home is at its highest. You will find that it is very often the ‘same kind’ of property that most tenants are looking for.... CONSIDERATIONS Trial and error is rarely the best method if you are serious about turning your investments into income.

Many people waste precious time and money learning the tricks of the trade the hard way. It is therefore my advice to always use the services of an experienced real-estate agent. It is not only so that they know the market much better; but they keep nice “stock” in their portfolios including possible bargains and fire-sales; they are familiar with most residential estates including condo developments; but moreover, they are also in direct contact with potential (corporate) tenants! Having said that, you are ultimately killing 2 birds with 1 stone!

...Did you ever consider that your broker might have properties on the books with ‘live-in’ tenants? You would purchase a property and immediately make an earning out of it! If this could be combined with an owner’s (or developer’s) finance; you might end-up in a situation whereby your tenant is paying most of your interest, if any... Wow! Another important consideration reflects on your personal circumstances: If you travel a lot or only reside in Thailand during holidays; you would enjoy the help of a property-manager...

What is a property manager, you ask? This person could be a family member or a friend that lives here in Thailand; a dedicated agent or simply the sales-office on-site that is looking after your property when you are not present. It sounds simple, but many people neglect to offer the ‘landlord’s service’ in case of an issue with the tenant...

So, what considerations do we have thus far? - Always use an agent to choose the right property - Consider a purchase with a live-in tenant - Assign a property-manager when you are not in Thailand EXPECTATIONS The average ROI (rental yield) in Thailand varies between 6-8% net, which is rather high even worldwide. If you are calculating your own return; please don’t over-project it as you will need to calculate: general maintenance, an agent’s commission, running costs when the house is not occupied, project management fee etc.

Hopefully you see a positive return that brings you some interesting monthly cash-flow... Joyfully, this is not everything... you might have forgotten about your capital appreciation (capital gain). Property investment offers a combination of rental income and capital gains. Investing in property is not only going to give us a positive cash flow but also the potential capital gains which depend on the property price increment. Over the last decade we have seen increases between 50-100%. If you would add this (as a sleeping bank-account) onto your earnings, you will see that an investment in a (rental) property is really worthwhile of your precious time; this is important as, everyone knows, time is of essence. And so is money.

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