A condo’s advertised yield is almost always the gross figure — rent over price, before a single cost. This guide shows how yield and return on investment really work on Thai condos: gross vs net yield, realistic numbers by area and segment, the costs that quietly eat your return, how capital growth and yield combine into total return, a full worked example, and the red flags — including guaranteed-yield schemes — that catch foreign buyers. Data and tools, never paid placement.
The gross yield on a Thai condo (rent ÷ price) typically reads 4–6%, but the net yield you actually keep — after common fees, tax, vacancy, furnishing and letting costs — is usually closer to 2.5–4%. Underwrite every deal on net yield, treat capital growth as upside rather than the plan, and be sceptical of anything advertising 7%+ or a guaranteed return.
When people talk about a condo as an investment they usually mean one of two things, and confusing them is the most expensive mistake a first-time buyer makes. Rental yield measures the income the property throws off, as a percentage of its value, each year. Return on investment (ROI) is the wider picture: the total gain — rental income plus any change in the property’s value — measured against the cash you actually put in.
Yield tells you whether the unit pays its way month to month. ROI (or total return) tells you whether the whole investment was worth making once you eventually sell. A unit can have a healthy yield and a poor ROI if its value stalls, or a thin yield and a strong ROI if it appreciates — so you need both numbers, and you need them calculated honestly.
Gross yield is the number you’ll see in every listing and sales deck because it is the most generous one. The formula is simple:
Gross yield = (annual rent ÷ purchase price) × 100. A unit bought for 5,000,000 baht and let at 22,000 baht a month earns 264,000 baht a year — a gross yield of 5.3%.
The problem is what gross yield ignores: it assumes the unit is rented every day of the year, costs nothing to run, pays no tax, and was free to buy and furnish. None of that is true. Gross yield is useful only as a first filter to compare units against each other — never as the number you base a purchase on. For that you need the net figure.
Net yield strips the running costs and realistic vacancy out of the rent, and measures the result against your all-in cost rather than just the sticker price:
Net yield = (annual rent − annual costs − vacancy allowance) ÷ all-in cost × 100. All-in cost = purchase price + transfer fees and taxes + legal + furnishing + any renovation.
The annual costs you subtract are the common-area maintenance fee (the per-sqm charge the owner pays), building and contents insurance, expected repairs, furnishing replacement, the agent letting fee, income tax on the rent, and the annual Land and Building Tax. Then you knock off a vacancy allowance — at least one empty month a year is realistic for most units.
The result is sobering: a 6% gross unit very commonly nets 3–3.5% once the cost stack and vacancy are taken out. That gap is not a Thailand quirk — it is the truth that gross yield is designed to hide.
Yields vary with location, unit size and the type of let. As an indicative guide for gross yields on standard residential leases (net is roughly 1.5–2.5 points lower):
These are starting points for your own research, not quotes. Check live comparable listings for the exact building and unit size, and confirm asking rents are actually achieved rents — advertised and signed are not the same. Our rental-yield tool and cap-rate guide help you sanity-check a specific deal.
Most of the gap between gross and net comes from a short list of costs that newcomers underestimate or forget entirely:
Total return is yield plus capital growth, and in Thailand the two rarely come from the same unit. The small, cheap, transport-linked condos that produce the best yields tend to appreciate slowly. The prime, scarce locations that drive capital growth usually carry thin yields because prices are already high.
Bangkok’s condo market has also gone through stretches of heavy new supply that flattened both rents and resale prices, and foreign buyers face an extra constraint: the 49% foreign-ownership quota can make some units slower to resell, which affects realised capital growth. Off-plan units carry construction and completion risk on top.
The disciplined move is to underwrite the deal on net yield alone. If the income stands up without assuming the price will rise, capital growth becomes upside rather than the fragile thing the whole investment depends on.
Purchase: 5,000,000 baht unit, 35 sqm, near a BTS station.
All-in cost: 5,000,000 + ~150,000 (transfer fees/taxes share & legal) + ~250,000 (furnishing) = ~5,400,000 baht.
Rent: 22,000 baht/month = 264,000 baht/year. Gross yield = 264,000 ÷ 5,000,000 = 5.3%.
Annual costs: common fee ~21,000 + insurance ~5,000 + repairs/replacement ~15,000 + agent letting ~22,000 (one month, amortised) + tax allowance ~20,000 = ~83,000 baht.
Vacancy: one month = ~22,000 baht.
Net income: 264,000 − 83,000 − 22,000 = ~159,000 baht.
Net yield = 159,000 ÷ 5,400,000 = ~2.9%.
The headline 5.3% becomes a real ~2.9% net — your cash-on-cash return as a cash buyer. Add a conservative capital-growth view separately (say 1–3% a year in a healthy market, possibly zero in an oversupplied one) for a total-return picture. Figures are illustrative; plug your own building’s real fee, rent and tax position into the yield tool and purchase-cost calculator.
Most yield disappointments are predictable. Watch for:
A condo only earns once the fees, tax, vacancy and furnishing are paid. Learn the building, check the achieved rents, and run the real net yield before you commit a baht.
Primary and official sources are cited above. Government rules, fees and procedures in Thailand change over time and vary by office; always confirm current requirements with the relevant authority before relying on them. BAANLYY never takes paid placement in editorial content.
General information only — not financial, investment, tax or legal advice. Yield ranges, costs, tax rates, the Land and Building Tax, vacancy assumptions and market conditions vary by building, area and case and change over time. All figures are indicative, not quotes or projections of return. Confirm achieved rents, current costs and your own tax position with licensed Thai professionals before investing. BAANLYY never takes paid placement.