Rent out an apartment or house in Phuket on your own
This is a great option for those who want to maximize profits and are ready to take over all the processes, as you need to understand that this is a full-fledged job that requires time, attention and constant participation, and of course, the actual location on the island.
An unconditional plus of working on your own is that you do not share profits with anyone. All proceeds from the rental stay with you.
And now let's move on to the nuances:
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Check-in, check-out, cleaning, repairs, solving current problems of tenants, marketing and promotion of the object fall on your shoulders. You need to be prepared for late-night rides or phone calls at 6am asking you to fix the iron or bring in a pot of a certain size.
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You need to find companies or people who will carry out cleaning and repairs. It will require both regular cleaning 2-3 times a week, and major cleaning when the tenant leaves. At an unexpected moment, it may be necessary both for a small repair of equipment and for refreshing the tiles in the bathroom. If you are renting a villa, then you should not forget about the maintenance of the pool and garden. Maintenance costs will be your responsibility.
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Rent price. You can only rent out on your own in complexes without a hotel license, which means that you will not be able to rent out your property by the day, as this is prohibited by law. The available rental period in such complexes is from 30 days, so you need to look for tenants for a long time, and the cost of such a rental is lower than the daily one. In addition, there is no single price regulation for the house, and there are often landlords who are ready to dump so that the property does not stand idle. This behavior in the market reduces the overall cost of rent.
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Marketing and promotion. To find out about your property, you need to post it in various groups on social networks or on large aggregator sites that take up to 20% of the rental price. You also need to always be in touch with potential tenants and be ready to answer any question.
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Payment of taxes. If you, as a foreigner, permanently reside in the country for more than 180 days, you can apply for tax residency and pay from 5 to 35%, depending on the total income for the year. For non-residents, the rate is 15%. Submission of documents to the tax authorities is your concern.
Rent through a real estate agency on the island
The owner of an apartment or villa can conclude a management contract with a real estate agency, in which case the latter acts as a trustee and is responsible for the property in your absence.
This is a very convenient option for those who plan to regularly come to rest in their apartments, since the period of independent living is not limited. At the same time, in your absence, the property will be supervised, and the real estate agency will take care of all the management efforts. And this means that you do not need to be involved in the process of finding tenants, checking in, checking out, cleaning, etc.
We talked about the advantages of this method, and now let's see what nuances remain:О плюсах этого способа поговорили, а теперь давайте посмотрим, какие остаются нюансы:
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Rent price. Since you can rent with the help of an agency only in complexes without a hotel license, there is no possibility of daily rent with a maximum cost, as well as with self-rental. The same applies to centralized pricing. The agency competes with landlords and faces price dumping in the market.
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Profit. The owner shares the profit with the real estate agency, as a rule, the compensation is 15-30% of the total income.
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Payment of taxes. The real estate agency does not pay taxes on the owner's rental income, so this responsibility lies with you.
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There are no guarantees. Unfortunately, no agency on the island can guarantee the delivery of your property. Therefore, it is necessary to allow the option of idle time of the object.
Rent through a hotel operator
If it's an income acquisition complex and you're not considering self-sufficiency, then hotel-managed complexes are a natural fit.
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Computational level of quality in the management of your property, all staff are audited and comply with regulations. The housing stock is always in perfect condition.
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Daily rent. The presence of a hotel license allows you to rent real estate by the day, and this is the highest price level.
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Centralized pricing. The hotel sets its own prices and has no competition within its facility yield programs.
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You will be offered affordable programs to generate income. It can be a fixed percentage of the cost or rental pool.
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Payment of taxes. In the case of hotel management, the latter is a tax agent and pays taxes for you. You are already receiving net profit in your account.
The only downside is a profit distribution. As a rule, the hotel keeps 30-50% of the income for itself. Take into account the fact that the profit from renting is higher due to daily rent, a large customer base and strong management. The owner is happy.
Conclusion:
Self-management can bring good profits if you live permanently on the island, are ready to 100% invest in the process and treat it as a full-time job. Renting out via a real estate agency is convenient for those owners who often use their apartment or villa for personal living, but at the same time want to earn income in their absence, and be sure that the property is under supervision. For those who buy property for the purpose of income and do not plan to use it for independent living, the best option would be to consider projects with hotel management.
We are always happy to help you with the selection of an option that meets your request and goals. You can sign up for a consultation by calling +66 61 958 0028 Maria
