Your Definitive Guide on Choosing Bangkok Accommodations

Bangkok is one of the most amazing places to visit in holidays. Whether you are a lover of natural beauty or fan of quality architecture, you will find Bangkok offering something for all.

However, it is obvious that you need to take rest after a long day of traveling and that’s when you need right Bangkok Accommodation. For all the savvy leisure and business travelers, this Asian business hub offers an array of apartments and hotels amongst the gleaming skyscrapers. Most of the facilities offer spectacular views, warm ambience, contemporary d├ęcor, homey feeling and direct access to the inner areas of this vibrant city. All of these attributes make the stay both functional and rewarding. But, with the provisioning of many outstanding and equivalent features, it becomes difficult for a traveler to effectively choose between a hotel and an apartment. Nevertheless, it is essential for a traveler to determine the best residential choice.

If you are in Bangkok for more than a week’s time, then apartments in Bangkok are a definite preference over the Bangkok Hotels. As compared to Bangkok Hotels which are well acclaimed for facilities, apartments in Bangkok offer hospitality of mystic East and comfort of home. Bangkok Hotels offer a cramped feeling whereas the space offered by the apartments is no match. Additionally, the plethora of facilities offered by these apartments further make them a logical choice.

When it comes to exceptional and always available services, nearly all of the apartments are equipped with satellite television, laundry services, free car parking and internet facility. Moreover, most of the apartments are provided with 24/7 security. Some of the apartments in Bangkok also encompass swimming pool, manicured gardens, and gym. All these are provisioned at a reasonable price as compared to what is offered by the expensive Bangkok hotels. The standard apartments cost around $12 per day, and pent houses averages around $50.

The best locations to find reasonable apartments in Bangkok include Sukhumvit which is the main road of Bangkok, Asok which is one of the most exclusive and expensive areas to live, Thong Lo which is widely known as the chic and fashionable street, and Sathorn which manifests the hustle and bustle of Bangkok. Additional business areas include the districts of Silom, Ploenchit and Chit Lom. Of these localities, Asok and Chit Lom are highly recommended as these are the classiest areas of Bangkok. Silom is notorious for the night market and is not preferred for family stays. Sukhumvit represents the energy and life of Bangkok and is always an enriching experience for adventurous travelers.

The reasonable pricing and explicit access to numerous facilities make apartments in Bangkok a definitive choice over the many Bangkok hotels. So, it is advisable to opt for these apartments.

Finding a Nice Apartment

When it comes to finding the very best apartment to stay at it is clear that you will run into a wide variety of options, and it can often be somewhat difficult to make up your mind about where to go. For starters, you will definitely want to take your time with this one, since it is clear that if you are going to be spending a lot of money to purchase a brand new apartment or even just rent one, you will want to do everything you can to avoid making the wrong choice. There are a few things that should be learned in the subject of apartments for sale before anyone makes that final decision to buy one, and by always remembering to be careful it is fairly likely that you will end up with an amazing looking apartment that will be really nice and just what you may have always wanted.

The first thing to do is to take a mental note of what you would ideally like your apartment to look like, as this will essentially help to simplify the process of heading out and searching for a new apartment for sale. Most people have a pretty good idea of how they would like their perfect apartment to look so if it turns out that you are already down on buying something that looks a certain way, it will be easier to locate it if you know exactly what you want already. There are numerous methods that can be used to find different apartments for sale, ranging from the hiring of real estate agencies to going out around town looking for them on your own. If there is a specific look for an apartment you may very well be able to find it.

Another thing you will want to consider very carefully is the overall amount of money that you are going to be paying in order to own that apartment. It is clear that some flats will cost a lot more than others and this price will vary according to a lot of things, such as the neighborhood in which the apartment is located, the size of the apartment, and how luxurious it is. There are a lot of things you need to consider carefully, but in any case it is important to remember not to go over budget in any way, because this could put you in a very bad place financially. Taking the time to decide on an agreeable price that you are willing to invest in a new apartment will help you to avoid the all too common mistake of getting into mortgage problems, so remember to do that.

As you can see, when it comes to seeking out a good apartment for sale, there are definitely a large amount of things you should always remember to take into careful consideration. As you learn more about the various pros and cons of buying apartments, these things will then be made all the more clear to you.

Deeper Analysis of a Potential Apartment Purchase

After using a property’s annual income and expense data, combined with the local cap rate to determine value, most offerings will be set aside as the unrealistic dreams of a deluded seller. Occasionally, however, a property will pass our first scan and deserve a second look. So what are the next steps to determine if we’ve really found a keeper?

The first step is to dig more deeply into the financial reports released by the seller. The critical thing to watch for here is to separate the actual figures from the pro forma numbers. Every seller, with the help of their broker, will attempt to paint the rosiest picture possible. You’ll do the same when it’s time for you to sell.

As an example, I’ll use information pulled from the most recent offer to cross my desk via Loopnet, a 28-unit C class apartment in Colorado Springs, offered at $1.3 million.

The Annual Property Operating Data (APOD) is a one-page summary of income and expenses. It calculates the Net Operating Income (NOI) as well as the cash flow before taxes. This particular APOD shows a cap rate of 8.79%, certainly within the current range of 8-9% expected for this class of apartment in this town in this year. It also lists the cash flow as $114,280 per year, or just over $9,500 per month. Assuming you paid the asking price of $1.3 million and put down 25%, or $325,000, the cash-on-cash return would be 114,280/325,000 or 35.2% So far, the numbers look promising.

But let’s look a little deeper. One of the easiest tricks to play is to merely leave some lines of the APOD blank. It’s easy to overlook something that is not even there. On this APOD there is a line for Management Services, but there is no number next to it. Even if you choose to manage it yourself, you should put a value on your time and effort. As it turns out, last year $8,300 went to this line item, which represents a 7.2% charge, reasonable in this market for this size property. Of course, underestimating your expenses, in this case by leaving one out, has the effect of increasing the NOI, which drives up the property value.

The other sin of omission occurs here by neglecting to include the annual debt service. Using the broker’s assumptions of 25% down and a 4.5% interest rate, the total mortgage payment is $60,800 per year. This is subtracted from the NOI to get the actual before-tax cash flow, which now drops to $53,480. This makes the actual cash-on-cash return 16.5%, definitely decent but less than half of what was shown on the APOD. Leaving out the management fee and the debt service has the effect of making this deal look much better than it actually is.

Now let’s look more closely at the income assumptions. The APOD has a note indicating that the current market rent for one-bedroom apartments is $495 per month. Since all the units in this apartment are one-beds, it’s easy to calculate the Potential Rental Income as $166,320 per year (495x28x12). However, in another part of the sales package labeled Income Summary, we find that less than $110,000 was actually collected in rent last year. Why the huge difference? Well, the current rent roll shows that 17 of the 28 units are paying $425 or less per month and only 2 are paying the full $495. What gives? Is the current owner asleep at the wheel, or is there something lacking in this property that prevents him from getting market rent? This is definitely something a potential buyer needs to explore in some depth. In fact, using actual numbers from last year, the cap rate at the asking price is only 4.7%!

Moving on from the financial analysis, we need to envision all the ways we can add value to the property. One of the easiest and most obvious ways is to improve the curb appeal. Potential renters won’t even slow down if the place looks like the owner fell asleep in the 70s and never woke up. A new top coat on the parking lot, well-trimmed and manicured landscaping and perhaps a new exterior paint job can make an apartment look like new almost overnight. Of course if the property has been a low-vacancy eyesore for a few years, changing the name and putting up new signage lets people know a new owner who actually cares for the property is now in charge.

Once you get a prospect inside, they will compare the perceived value to that of other apartments they’ve looked at. This is where your personal market research comes in. What amenities do other properties in your rental range have? Will you need new kitchen cabinets or will a paint job and new hardware be sufficient? Will you opt for new carpet or will you try the linoleum that looks like a hardwood floor? New lights in the kitchen and bathroom can add pizazz for very little cost.

Windows are a controversial topic among owners. If the residents are paying for utilities, it doesn’t directly help the owner to put in new ones, which is why you see so many older buildings with original windows in place. On the other hand, new double pane energy-efficient windows, along with uniform new blinds, can instantly improve the curb appeal. You can also tell prospects that their utility bills will be lower and their apartment quieter and more comfortable. It’s also one more thing the person who buys from you won’t have to pay to replace. In addition, there may be utility rebates available that lower your net cost if you choose to install them. Needless to say, all these expenses must be accurately estimated and still have all the numbers work. If a property has a lot of deferred maintenance, you must factor that into your offer or it’s not worth buying.

The bottom line for all this is how much can you raise the rents? Can you raise them enough to justify these expenditures? Can you buy it cheaply enough to allow these upgrades? You’ll definitely want an experienced member of your team to help you make these decisions when you’re first getting into this.

Finally, you need to look at the operating expenses to see if there are ways to reduce them. Running a more efficient, smarter operation can lower expenses. Do you need a full-time employee or can you outsource many of the operations? Can you charge back your residents for common area water, gas and electricity? Are they being charged for their share of trash pickup? Your market may put limits on how much of this you can do. You might also experiment with a lower rent plus these utility chargebacks versus a higher, all-inclusive rental figure to see which is more enticing to your prospects.

Once you’ve done your quick 5-minute evaluation of the numbers, most properties will be revealed as the duds they are. The ones that pass that first screening are ready for this more in-depth analysis. Once they pass this, it’s time to submit a Letter of Intent and let the negotiations begin. Have fun and good luck!