Renting Out Your Condo in Pattaya: Advice for Landlords

I own two real estate agencies in Pattaya, Alan Bolton Property Consultants and East Coast Real Estate, and we look after a lot of rental condos. Here's what I'd tell anyone thinking of becoming a landlord here.

What makes a condo rent easily?

The building, more than anything, and the facilities in it.

The two that matter most are the pool and the gym. Funnily enough, they don't get used that often. People choose a place with the best intentions of using the gym and the pool every day, which never actually happens, but it still drives a lot of decisions.

What do tenants expect inside the unit?

Fast, reliable internet. That's an absolute must. If the internet in the building is poor, someone will move in and move out again pretty quickly. A tenant can get a line put in from another provider, but if decent internet is already installed, or even included in the rent, that's a big bonus.

Should you furnish it?

Yes. Almost every rental in Thailand comes fully furnished. People come and go here and generally don't have their own furniture, so it's not really up for discussion.

Where landlords go wrong is spending too much. They put a big 65-inch TV in a small condo, and then it gets damaged. My advice is to keep it clean and well furnished but basic. Think of it like an Ibis or a Travelodge room.

Short-term holiday lets or long-term tenants?

For a start, lets need to be for at least a month. Renting by the day or week is generally treated as running an unlicensed hotel, and most condo managements (the juristic person) won't allow it.

I get the appeal of renting your condo out while you're not using it, like renting your car out on Turo back home. It sounds great, until somebody smashes up your car or trashes your condo. For me, having lots of different people going in and out isn't the right way to do it. You're better off finding one good long-term tenant.

How do you find and keep a good tenant?

To find one, use an agency. You can advertise on Facebook yourself and you might get lucky, but I've written before about the problems that can come up without a neutral third party in the middle.

To keep one, just be reasonable. If the tenant tells you the bathroom smells and you refuse to fix it, don't be surprised when they move out at the end of the tenancy. Some requests are unreasonable, and that's where the agency comes in. But if you're an unreasonable landlord, you won't just lose that tenant. Word gets around the agencies, and you'll struggle to find the next one.

How should you price the rent?

Of course it's better to drop the price a little than sit empty, but I wouldn't start there. List with a couple of agencies whose customers don't overlap. If that doesn't work, open it up to more.

If it was sensibly priced from the start, the reason it isn't renting is usually exposure, not price. Keep adding agencies over time rather than cutting the rent.

What return can you expect?

Realistically, 5 to 6%. If you're lucky, 7 or 8%, but to get that you have to have bought really smart. Once you take out maintenance, wear and tear and the months it sits empty, over ten years I'd expect it to average between 5 and 6%.

Buying smart means getting a good deal, and knowing it's a good deal, which means knowing what to look for. It also takes a bit of luck with location. Areas can take off quickly, sometimes because of something as simple as a new shopping centre. Grand Avenue is a good example: a fairly standard building at around ฿70,000 a square metre, then Soi Buakhao next to it got really busy over the last ten years, and prices have gone up quite a lot since.

How do deposits work at the end of a tenancy?

The contract should state clearly that normal wear and tear is acceptable. The problem is that normal wear and tear is subjective, and that's where an experienced agency mediates to reach something fair.

A reasonable landlord, often someone who's been doing it a long time with several properties, is normally pretty fair, and the deposit goes straight back. Some keep 10 or 20% for small things. I wouldn't call it standard, but most tenants should expect some of their deposit to be kept when they check out.

Can you manage a rental from abroad?

Absolutely, but not entirely from abroad. You need help on the ground. You could ask the juristic person, but that's risky, because it isn't what they do for a living and they won't have dealt with every situation. Probably 90% of overseas owners do it through an agency.

My best advice for first-time landlords

Work with reputable agencies: ones with history, a proper office, experience and plenty of staff.

We all charge the same, one month's rent as commission on a 12-month contract. So to you as the owner, it costs the same whether you use Alan Bolton, which has been in business for 45 years, or a brand-new company. So why wouldn't you use a more reputable one?

Read my guides to buying a condo in Pattaya, renting a condo in Pattaya from the tenant's side, and the Pattaya property market right now. To list your condo, contact Alan Bolton Property Consultants or East Coast Real Estate.