Condo-buying mistakes to avoid

[Sen Yai]

I dedicate this cut'n'paste to Homintern and John Botting


Buying a condominium can be akin to crossing a minefield because there are so many factors to consider and as many, if not more, mistakes to avoid. Your choice also reflects your taste and shrewdness......"If you're buying something with the expectation that you are definitely going to be able to sell at a profit ... that's not necessarily going to be the case,".........."It has to depend on the building and you can never tell how big the resale market in a particular building is until a few months before completion. We actually have quite a lot of examples where people are trying to resell at profit and there are no buyers." NINA SUEBSUKCHAROEN

Full article in the Bangkok Post (http://www.bangkokpost.com/110906_Yourmoney/11Sep2006_money04.php)

Not much that we haven't heard before really. To buy or not to buy? Up to you!

[Dboy]

I'm still waiting for any reasonable case for buying. New Visa rules add to the case for renting. Lack of zoning and poor contruction quality will not be solved anytime soon.

Dboy

In my view, if you want to buy a condo in order to make a profit when the value appreciates, the basic rule for buying is.. D O N T.

It brings to mind the question: How do you make a small fortune in Thailand? The answer: start with a large fortune.

You won't make money, but, if you stay long enough, maybe you can save some money, but I doubt it. Or you will have something to pass on to your beloved when you depart these shores.

I would rather own my own place,that way i dont have to keep moving,i can do what i like with it,paint it purple whatever,like i have with my own sydney apartment,purple walls with red doors.
The thing is i want something to call my own and know i have it.Well, we actually agree on this issue!

Regarding the first quote, however, apparently in Thailand tenants can redecorate rentals to their heart's delight. I shared a rental townhouse in Bangkok with an American (Puerto Rican, later New Yorker) and we gutted one floor, changed walls, installed a bathroom, etc. I was mortified at the idea, but turns out the landlord was okay with what we'd done. So, not sure how valid the first quote is in Thailand, but I *still* subscribe to that (old-fashioned?) notion that if you change the condition of a rental, you pay for it when you move out.

One time I rented an apartment in Hawaii and never used the electric range for 1.5 years. When I moved out, I was charged a $25 cleaning fee because when the manager lifted the range cover, it was dusty around the burners. I was charged another cleaning fee because the outside of the windows weren't sparkling clean like they were when I moved in.

Regarding the second quote, I think you and I are plain old old-fashioned in wanting to own the place and call it our own. My parents grew up in The Great Depression (their son only experiences minor depressions from time to time <g>) and they instilled some very definite values regarding ownership and security. I suspect the younger generation, and even my generation if their parents weren't sandblasted by The Great Depression, might not share those values.

I bought a condo to live in.
I thought it was also possibly a good investment and had rental potential if I wanted to move away from Thailand.
However, I think this new visa crackdown is serious and will have a major impact on the size of the pool of potential long term renters. I think you have to be baa baa to buy a condo right now for the rental market.

[Dboy]

Regarding the second quote, I think you and I are plain old old-fashioned in wanting to own the place and call it our own. My parents grew up in The Great Depression (their son only experiences minor depressions from time to time <g>) and they instilled some very definite values regarding ownership and security. I suspect the younger generation, and even my generation if their parents weren't sandblasted by The Great Depression, might not share those values.

Or maybe the younger generation has figured out that (in the US at least) real property ownership is just another collective fantasy. All property in the US is owned by the US government and the sub-letted to US citizens. The government reminds us of who *really* owns real property by using such tools as property taxes and eminent domain. As George Carlin once said, "It's called the American Dream because you'd have to be asleep to believe in it".

Dboy

All property in the US is owned by the US government and the sub-letted to US citizens.I've been quite fortunate to be able to cash in on some nice capital gains while controlling stewardship of my US property. :-)

It enabled me to support my parents who had no retirement earnings other than Social Security, and the house that I've bought for them will allow me to once again cash in on some nice capital gains when they finally leave this realm.

But, yeah, I totally understand the opposing view point of mine, i.e. that owning property is often (always?) not the best thing. It's just very hard to undo 50+ years of programming.

[Dboy]

I've been quite fortunate to be able to cash in on some nice capital gains while controlling stewardship of my US property. :-)


You have made those capital gains in exactly the same way as a long call option vs being long the asset. If you're long a call, you have the opportunity to "win" based on movement of the underlying asset, without actually owning it.

Dboy

... apparently that is the latest place to buy cheap property, La Manga type developments ... and they are selling like hot cakes ... but you have to do your homework on them ... will be ready by end of 2008 ... will keep you informed ... the Moroccan coastline is near the Spanish border, and there are also some Spanish towns (owned by the spanish) on the Morrocan coastline ... that is where to buy. Lets see what happens anyway.

Severla years ago I purchased a condo in Pattaya for about $60,000 (US). Many people feel if you get a 6% rental factor then that is a fair return. Currently the unit is rented at a factor of 11% long term. The other thing is the rent is paid in baht. So it gives a little conversion hedge since the baht is becoming stronger against the dollar.

Will the market crash. I don't know. One of my LA properties (4 unit) increased in value frorm $82,000 to an appriased value of $940,000. Will that market crash. I don't know But due to rent control in Los Angeles I can only get a 3.5% rental factor. So who really knows.

[Impulse]

I bought my vt 5 condo as an inflation hedge.I paid 60,000 us dollars also and I expect it to cost about 100,000 in a few years.It cost 10% more in one year because of the declining dollar and I expect the dollar to plunge drastically very soon.Im not renting it as Im counting on price appreciation.