Prop2morrow Co., Ltd., through PropaChill, the first provider in Thailand offering rental housing including houses, condominiums, and apartments without a full deposit, organized a seminar titled “Unlocking the Treasure of the Condo Rental Market Along the BTS Line Priced Under 10,000 Baht”. Mr. Thana Torsahakoon, CEO of Primo Service Solutions Co., Ltd., a subsidiary of Origin Property Public Company Limited (ORI), revealed under the topic “Unlocking the 10,000 Baht Rental Market” that currently, rental yields from condos in the city are starting to decline, unless operators offer condos at special prices. However, in recent years, operators have begun to move away from the lower-end market and focus more on developing luxury condos. The most promising investment zones are from Udom Suk downwards or areas from Kasetsart University upwards, where units can be rented out effectively.

          Nevertheless, the trend shows that tenants are increasingly moving out of the central business district (CBD) to reduce rental costs. The travel time on the BTS to the CBD is not very long, and units can be rented out quickly, while city center units are taking longer to rent out, forcing owners to lower their prices. Apartment operators are also finding it increasingly difficult as their prices are close to those of condos, but customers prefer renting condos due to their more comprehensive amenities.

          Mr. Kantithat Malatha, Vice Chairman of Deal Co., Ltd., a subsidiary of Pruksa Real Estate Public Company Limited (PS), also conducted a poll on condo rental prices along the Blue Line BTS. He stated that the Blue Line, which connects in a large circle (Circle Line), will begin trial services in August 2019 and will be fully operational by the first quarter of 2020. Data shows that the expansion of the Blue Line has impacted the real estate market value over the past nine years (2011-2019), with the real estate index continuously rising. Land prices increased by 46.6%, while new condominiums rose by 66%, resulting in a 39% increase in price per square meter. The selling price in 2011 was approximately 80,000-90,000 Baht/square meter, which has now increased to 140,000-150,000 Baht/square meter. Meanwhile, property taxes have also benefited, increasing by 11%.

          “The Blue Line does not solely drive growth; the urban planning also contributes to growth rates and changes the potential of the city, facilitating the flow of external culture inward, which enhances the potential in newly developed areas. The Blue Line is the first Circle Line in Thailand and is expected to attract an additional 500,000 people to this area by 2020,” Mr. Kantithat said.

          He further added that survey results predict that by 2021, there will be a total of 28,500 completed units, consisting of 8,550 rental condos, with an average monthly rental rate of 14,030 Baht. The rental prices range from 7,000 to 80,000 Baht/month, with one-bedroom units of 25-28 square meters being the most sought after. Areas like Bang Khun Non and Thapra are expected to be the most popular, with rental prices performing well between 10,000-12,000 Baht per month, and the highest average return on investment at 6.08% in the Charan 13 area, which is close to Sathorn. Meanwhile, the Bang Phlat area has the highest return at 8%, while the lowest return is in Thapra at 4.40%.

          The main customer group consists of students, making up over 70%, while the remaining 30% are working individuals in areas near the Blue Line. Another factor that attracts tenants is the furniture and various amenities available.

          Mr. Nethi Narumit, Managing Director of W2 Property Co., Ltd., spoke under the topic “Do's & Don'ts for Renting Out Real Estate”, stating that there is still a significant supply of rental properties in the BTS zone, as buyers continue to invest for rental purposes. At the same time, customer living trends are changing; for instance, Japanese tenants who previously preferred to rent in the Thonglor-Ekkamai area are now increasingly renting in the Sukhumvit area, leading to a decrease in rental prices.

Key Factors to Attract Customer Interest Include:

1. Decorating the room to make it livable and different from competitors, including offering options that make it easier for customers to decide to rent, such as free internet and one free cleaning service per week, which also helps keep the room tidy for the owner.

2. Rental prices; rates of 15,000-20,000 Baht/month can still be rented continuously, but the rental period may be shortened from one year to three or six months to increase rental opportunities.

3. Contracts must be clear and comprehensive, as some customers may negotiate prices to rent out daily, which is illegal.

4. Marketing; each rental price point attracts different customers. Customers renting in the thousands to tens of thousands per month will be marketed online or through staff, while those renting units priced at 50,000-100,000 Baht and above will likely rent through secretaries or familiar agencies.

          Mr. Ratchawut Pichayapan, Managing Director of Fixi Co., Ltd., a startup providing an application that aggregates various craftsmen in Thailand, stated that this year marks the fourth year of their service. Currently, they have a network of 4,000-5,000 teams of craftsmen in the Bangkok and surrounding areas.

Thank you for the information from www.prop2morrow.com