For the last five years, I’ve lived beyond my means without paying for it.
In 2011, I rented an upscale one bedroom condominium with a 50 meter lap pool and gym for 24,000 baht ($675 USD) per month. My neighbors paid 40,000 ($1,125).
From early 2012 to late 2014, I rented a gigantic, brand new 180 square meter corner penthouse for 50,000 baht ($1,400) per month. My neighbors paid 90,000 ($2,500).
As of right now, I live in a central city apartment that was listed for rent at 50,000 baht ($1,400) per month. I pay 38,000 ($1,070).
Every month, I meet expats that are astonished at the price of renting property in Bangkok. Since 2009, when I first moved here, the prices posted on real estate websites have gone from reasonable to outlandish, especially for new developments.
The other day I saw a 100 square meter condo in a new development in Thong Lor listed for 110,000 baht per month. On a square footage basis, that’s a higher rent than lots of brand new apartments in upmarket parts of Tokyo achieve.
One reason for the high rents is that the price of buying property in many parts of Bangkok has increased by an incredible amount over the past five years. Most owners seem to price their units based on a 5-7% annual yield, even if it isn’t a realistic price for attracting tenants.
Luckily, the prices you see on real estate agency websites can easily be reduced, often by a massive amount, using some simple negotiating techniques.
Below, I’ve listed the five tactics I use to live in luxurious apartments that should be out of my price range, all without spending more than I want to. I’ve used these tactics in Bangkok and Tokyo, but they should work just as well in any city with a large supply of residential real estate and occupancy in the 85% or lower range.
Based on feedback from my friends, I know they also work reasonably well in cities like Hong Kong, where demand for housing is higher and tenants aren’t perceived as having as much leverage.
If you’re an expat or digital nomad, give them a try. After all, you lose nothing by asking for a discount.
Note: These tips are aimed at people intending to rent for at least six months. You can still get good deals on short-term housing here, but the longer you’re willing to commit, the better the deal you’ll get.
Don’t take agency prices seriously. Work out the minimum publicly listed price for each development, then bargain
Most agencies in Thailand overprice their condos by 20% or more. Some are realistic about pricing and list their units for close to the market price, but most swing for the fences with prices that are completely out of line with reality.
Case in point: one building (an upscale development on Soi Thong Lor) has units listed by owners for 45,000 to 50,000 baht per month. Several agencies list these units for 70,000 baht.
Don’t take the prices you see on agency websites seriously. If you’re interested in a certain building, Google its name and “for rent” to work out the average price for units listed by real estate agencies, then take 20% off to work out how much you should offer.
One good way to work out the real market price for a unit is to search on Prakard.com for previous listings and prices. I search using Google for “site:prakard.com [Building Name][Price]” and it usually returns a bunch of listings at prices way below what the agencies are offering.
For example, “site:prakard.com Millennium Residence 35,000” brings up several listings for 67 square meter units in Millennium Residence for 35,000 baht per month. These units are usually listed at 45,000 to 55,000 on the agency websites. Most of the listings are a year or two old, but they still give you a lot of negotiating power. Mention to any agent that you’ve seen units listed below their price and they will usually match the rate you saw advertised.
Another way to do this is to search on HipFlat.co.th. You’ll occasionally find the exact same unit listed for different prices by different agencies, often with a huge difference in pricing between websites.
Once you’ve worked out the real market price, contact every agent or landlord with an available unit in the building. You want to get discounted quotes from each of them, then play them off against each other to get the best possible deal.
Look for condos that have been vacant for at least six months
You’ll get the best deals by looking at condos that have been vacant for a long time. The reason is obvious: most owners want to get rental income, and every month a unit stays empty is another month they get nothing in return.
Since most real estate companies don’t show the listing date of each property, the easiest way to find units that have been empty for a long time is by using forums like Prakard.com.
Navigate to the fourth or fifth page for most popular buildings and you’ll see a bunch of listings from five or six months ago. The best listings to go for are the ones that have long threads that have been bumped hundreds of times by the agent in a desperate search for attention.
I ignore all of the listings that are less than a month old, unless they’re exceptional. You will get a far better response by contacting owners (or agents) of units that have been vacant for at least six months, since they’re usually starting to get desperate for a tenant.
The bigger (and more expensive) the unit, the more you can negotiate
In Bangkok, most condos fit into one of four categories:
- Small studio or one bedroom condos (30-60 square meters) aimed at singles
- Bigger one bedroom condos and two bedroom units (60-80 square meters) aimed at couples
- Large two to three bedroom units (100 square meters or more) aimed at wealthy Thai families and expats
- Super luxury units (eg. with private swimming pools like Le Raffine 39) that are priced out of reach of anyone earning less than $150,000 per year
Since Bangkok attracts a lot of single expats on limited budgets, the first category has a lot of demand and a normal amount of supply. Discounts are small (I’ve negotiated 10% off before) but still worth asking for.
The second category is a little better. However, you’ll get the biggest discounts by looking at the third category: large two bedroom and three bedroom condos in high-end developments.
I’m talking about the rooms available in buildings like The Met, Domus, The Emporio Place, Le Monaco Residence Ari, Millennium Residence and other premium buildings aimed at upper/middle class tenants, particularly rich families.
In Thailand, most upper class families prefer to live in houses than condos. Since most wealthy expats in Thailand are single and employed by companies that supply housing for them, they rarely need a large apartment designed for a family.
These apartments are in great supply, very frequently unoccupied (take a look at many of the buildings at night — there aren’t many lights on) and competing for an audience that just isn’t there, for the most part.
This means that you can get some killer deals if you negotiate effectively. I’ve rented a 180 square meter unit in this category with incredible panoramic views of the city for the same price as a much smaller, less comfortable 90 square meter unit in a nearby development.
You can also get some pretty amazing deals in the fourth category, but since I can’t spend $4,000 a month on rent I’ve never tried.
You’ll also get the biggest discounts if you look outside the areas that most expats live in. Most condos in Thong Lor and Phrom Phong — two popular expat areas — have high rental rates relative to the price of the unit. Move a couple of stops down the BTS to Ekkamai or Phra Khanong (or look in Ari, Silom, Sathorn and other areas that aren’t priced as aggressively) and you’ll be able to get much better value for money.
For example, 90 square meter, two bedroom units in The Met (a high-end development in Chong Nonsi) sell for 15 to 18 million baht and rent for between 45,000 and 60,000. That’s a low annual yield of 3.6% and a high yield of 4.8%.
90 square meter units in The Emporio Place (a high-end development close to Phrom Phong BTS) cost about the same amount to purchase, but rent for 60,000 to 75,000 per month. That’s 4.5 to 5.6% per year.
Frame the negotiation as you offering them value, not them offering you a good deal
In a city like Bangkok, with a huge supply of high-end condos and limited demand, good tenants are a pretty valuable commodity. Because you’re valuable, you can negotiate from the perspective of you helping them, rather than them helping you.
One way to do this is to offer to sign a longer lease. You’re providing value in the form of extra guaranteed occupancy for the landlord, and in exchange they can provide reciprocal value in the form of a lower price.
This tit for tat negotiation works well on agreements and deals in Thailand, since it doesn’t result in either party losing face. You’re not hurting them with a lowball offer (and implying their property is worth less than they say it is) — you’re just asking for something in exchange for the value you’re offering.
You don’t have to sign a longer lease to do this. I’ve printed recommendations and certificates from previous landlords and employers to show that I’m a responsible tenant, then used them to negotiate a discount. As long as you show you’re offering some value, even if it’s completely artificial and subjective value, you change the negotiation from being “give me something” to “I’ll give you something, now give me something in return.”
In Thailand, where keeping face is important, this keeps landlords that would otherwise turn down a lowball offer interested.
Here are some items you can use to demonstrate your value in a negotiation:
- A long term visa and work permit, which shows the landlord you won’t disappear in the middle of the lease
- A recommendation from your previous landlord explaining that you’re a good tenant
- A copy of your bank statement showing that you’ve got enough cash to easily pay the rent
- Your university degree, especially if it’s something prestigious like law, medicine or engineering. Titles matter in Asia, and pretentious displays of your education can work surprisingly well in situations like this.
The key is to just have something to offer, even if it’s mostly nonsense. Merely offering something means the landlord isn’t giving you as a freebie, which they might view as an embarrassing sign that they’re in a weak position.
Once you’ve negotiated a good deal, tell them you’ll think about it. Then, contact all of the other owners/agents of similar units to tell them the price you were offered, and ask if they can beat it.
Negotiate the rent first. Then ask for free stuff, like an electricity allowance or a free month’s rent.
In 2011, I negotiated a 16,000 baht monthly discount on a condo I liked. I then got the landlord to agree to a month of free rent and a three month discount of 1,000 baht on each electricity bill I received.
Asking for free stuff is a great way to reduce the amount you pay for your condo without actually reducing the rent. It works well because agents here are paid the first month’s rent as a commission, and thus aren’t as interested as reducing the rent as they are throwing in other extras.
In countries like Japan, where you pay key money to move into the apartment, you can take a different approach. Most foreigners freak out about paying key money (basically a one-off payment to the landlord for the “privilege” of living in their apartment) since it’s so unusual in the West.
They try to negotiate the key money and fail, since the key money mostly ends up going to the agent and the agent has no incentive to reduce their commission. In this case, it’s better to negotiate the rent (which is usually surprisingly flexible) and get a discount that’s equivalent to avoiding the key money altogether.
Ask for something else and you actually help the agent by making it easier for them to close the deal without affecting their pay. I’ve found that most landlords will agree to a free month’s rent if you ask persuasively and make it clear that you’re offering them lots of value in return.
That free month is an extra 8% discount on your rent.
If they say no to a free month, ask for other stuff. Free electricity, a new TV for the living room, a new sofa or a fast Internet connection. Lots of landlords will agree to this stuff because it’s an investment in their property that both of you benefit from, instead of a freebie just for you.
Let me know if these tactics work for you
I’ve used these tactics on three apartments in Bangkok and one apartment in Tokyo. Every time, I got a significant discount and/or free stuff from the landlord. If you’re looking for a rental condo in Bangkok and don’t want to pay the listed prices, give them a go and let me know how well they work for you.