When buying an investment property in Phuket, what are your options? What should you consider?
Investment properties can provide supplementary income, helping you afford a better lifestyle and taking you one step closer to achieving financial independence.
While this is an exciting time for you, it can also be a little intimidating.
Location, amenities, price, potential repairs, and hidden costs, there are many things to consider when purchasing an investment property. After all, the goal is to rent it out quickly, maximize your return and turn it into a healthy profit!
To help you make good decisions we’ve highlighted some tips for you to consider while viewing property.
Getting Emotionally Attached
Buying an investment property in Phuket is a business decision. Sometimes it may be hard to remember that you are not buying it for personal reasons. Some properties will appeal to you more than others. Details, such as a nice garden, a kitchen you would love to have, or a neighborhood that looks familiar, can easily trigger emotions and slant your decision. You need to stay focused to make sure you’re selecting the right home for potential tenants, not for you. Letting your heart rule your decision can lead you to overcapitalize on your purchase and not negotiate the best deal.
Besides, potential tenants may not view the property with the same sentimental value as you do. However, they’ll notice the lack of amenities and convenience.
Here are the key things tenants are looking for when searching for a rental in Phuket:
- Location
- Proximity to the Beach
- Nearby shopping, restaurants, supermarkets, and other amenities
- School district
- Move-in ready conditions
- Safety and security
- Appliances
- Parking
- Open floor plan
- Outdoor space
- Security
Make sure to focus on these criteria when house hunting in Phuket. Remember that you’re not buying this home for yourself, so take a business-minded approach before making a decision.
Do Your Research
Do your due diligence before purchasing an investment property in Phuket. This can prevent turning your investing dream into a financial headache.
Some of the critical things you should do include:
- Attending a significant amount of inspections before buying. This will allow you to familiarize yourself with the market prices, conditions, and purchasing process.
- Researching the local area and understanding key factors that can appeal to your potential tenants. These include schools, shops, restaurants, transport options, and playground areas.
- Rely on your real estate agent as a source of information, but also check other sources. Talk to other property experts and use a few different independent sources for neighborhood information and price data to gather information and make an informed decision.
- Speak to local Property Management Companies; ask their opinion on how desirable a location or property type is for renting out and get estimates for any renovation work required on the property before it is ready to rent out.
Waiting for the Perfect Property
Property investors sometimes fall into this “trap”. They spend lot of time gathering information and inspecting homes. Waiting to find the perfect property and make the best deal results in them ending up procrastinating. Buying a house or villa is a significant financial commitment and being cautious and doing due diligence is extremely important. But you’ll never get into the Phuket property market if you never buy.
Make sure the property fits the most important criteria tenants are looking for, assess if the “imperfections” can easily be fixed and then make an offer based on what you think is a fair price according to your research. Otherwise, you might be waiting for a long time for the perfect property.
Considering Additional Costs
Buying an investment property is not just about the purchasing price. There are many additional fees to consider when doing your financial planning.
Below some additional expenses to keep in mind when making a decision.
- Maintenance and repair costs
- Potential renovations
- Legal and paperwork fees
- Advertising and marketing to tenants
- Inspections costs
- Common Area Management Fees
- Property taxes
- Insurance
- Periods of vacancy: This will vary based on the market conditions, the condition of your property and the location. You should have an idea of the average vacancy rate in your area so that you can budget for it.
- Phuket property management company fees
Make sure to factor in all of these costs to assess how much rent you’d need to ask for. This will help you decide whether the property you’re leaning towards is a good investment.
Hire a Professional Property Management Company
Successful property investors rely on a network of specialists to help their clients maximize their investment.
A Phuket property manager can not only save you time by managing your rental property but they can also save you money!
How?
By leveraging their network of contractors and specialists who can provide discounted rates they can help you maximize your ROI every step of the way
The main areas they can help you with include:
- Marketing your property, organizing inspections, and screening applicants
- Handling maintenance and repairs
- Handling tenants’ requests and solving conflicts
- Collecting rent
- Helping to keep tenants happy to maintain a lower vacancy rate
- Organizing and supervising the move-in and move-out process
A Phuket property manager will help you optimize and grow your rental income by acting as a business partner and working with you. Also, working with a Phuket property manager will allow you to focus on other areas of your life, such as developing your property portfolio or enjoying quality time with your friends and family!
Are you looking for a reliable and experienced Phuket property management company? Contact Baan Wise at https://baanwise.com/contact-us/
We’d love to help you find high-quality tenants and manage your property for you!