ROI After All Fees in Thailand: What Phuket Property Investors Actually Keep

Marketing brochures often quote gross rental yields of 7–9% in Phuket’s condo investment segment. Experienced investors know gross is where the story starts—not where it ends. After management fees (often 15–20% of revenue), OTA commissions (often 15–20% of booking value when using Airbnb/Booking.com), CAM fees (often ~$1,000–$1,500/year for a 50 sqm unit depending on tier), and tax withholding (often modeled around 15% of gross rental income for some non-resident cases), net yields frequently fall into a 4–6% band for typical short-term rental operations—unless you optimize operations (direct bookings, lower commissions, strong occupancy).

Gross vs net: definitions that prevent arguments

Metric	Formula (conceptual)
Gross yield	Annual rent ÷ purchase price
Net yield (cash)	(Rent − operating costs − tax) ÷ purchase price

Step-by-step: from gross to net (example)

Assume:

• Purchase price: $200,000
• Gross annual revenue: $18,000 (9% gross yield)
• Management fee: 18% of gross revenue = $3,240
• OTA commissions: 15% of gross revenue = $2,700
• CAM + other building: $1,200/year
• Withholding tax (illustrative 15% of gross) = $2,700

Line	USD
Gross revenue	$18,000
− Management	$3,240
− OTA	$2,700
− CAM	$1,200
− Tax (illustrative)	$2,700
Net cash (illustrative)	$8,160

Net yield: $8,160 / $200,000 = 4.08%.

Sensitivity table: OTA + management dominate

Hold gross constant at $18,000 and vary management + OTA as % of gross:

Mgmt + OTA combined	Illustrative fees	Net before CAM/tax
30%	$5,400	$12,600
35%	$6,300	$11,700
40%	$7,200	$10,800

This is why distribution strategy matters as much as location.

Better scenario: direct bookings and lower management

If you reduce OTA to 5% of gross and management to 12% of gross:

• Combined = 17% → $3,060
• Same gross $18,000, same CAM $1,200, same illustrative tax $2,700
• Net = $18,000 − $3,060 − $1,200 − $2,700 = $11,040 → 5.52% net

Strategy	Tradeoff
More direct bookings	More owner time / systems
Full-service operator	Less time, higher fee %

Why CAM is not “small” in low gross months

CAM is fixed monthly. In low season, gross revenue may fall while CAM stays constant—compressing net margins even if gross yield looked fine annually on a spreadsheet.

Month type	Revenue	CAM
High season	High	Same
Low season	Lower	Same

Capex and furniture: don’t forget the balance sheet

ROI discussions often ignore furniture replacement every few years, AC servicing, and minor repairs. Budget $1,000–$2,500/year for a 50 sqm unit as a maintenance reserve—not tax, not glamorous, but real.

Occupancy: the silent variable that beats fees

You can win the fee battle and lose the occupancy war. A 10-point occupancy drop can erase fee optimizations instantly.

Occupancy	Revenue impact
70% vs 60%	Material

ADR vs occupancy: Phuket dynamics

Some owners chase high ADR but accept low occupancy; others optimize occupancy with moderate pricing. The best strategy depends on submarket competition and review momentum.

Strategy	Tradeoff
Premium ADR	Higher risk in soft periods
Occupancy-first	Lower ADR, steadier cash

Gross yield traps in marketing materials

If gross yield uses peak-season nightly rates annualized naively, it will overstate reality. Demand trailing-12 operator data where possible.

Yield type	Reliability
TTM actual	Higher
Peak-season extrapolation	Lower

Net yield and exit: what buyers pay for

Even if net yield is 5%, capital growth (or loss) may dominate returns. Keep total return in mind—especially in off-plan purchases.

Sensitivity table: management fee changes

Starting from $18,000 gross rent:

Management % of gross	Fee USD
15%	$2,700
18%	$3,240
22%	$3,960

Small percentage moves matter because they scale with gross.

Deep dive: building a defensible net-yield model (template)

Inputs you must include

• Gross nightly revenue (seasonally adjusted)
• Occupancy (not “if everything is perfect”)
• Management fee % of gross
• OTA commissions % of gross
• CAM (fixed)
• Utilities (variable)
• Maintenance reserve
• Tax reserve (scenario)

Worked sensitivity: gross yield vs net yield

Purchase	Gross yield	Net yield (illustrative)
$180,000	8.5%	4.5–5.5%
$240,000	8.0%	4.0–5.0%

Why “net” is personal

Two owners in the same building can have different net yields due to OTA mix, direct bookings, and utility discipline.

Final takeaway

Net yield is operating skill as much as asset selection.

Appendix: ADR vs occupancy trade-off table (conceptual)

Strategy	What you optimize
High ADR	Price per night
High occupancy	Utilization

Appendix: review score compounding

Better reviews allow pricing power—pricing power improves gross, which improves net even with the same fee percentages.

Appendix: what professional managers should show monthly

• Gross revenue
• Channel mix
• Refunds/chargebacks
• Cleaning costs
• Owner payout

Appendix: closing thought

Net yield is the scoreboard—gross yield is marketing.

Supplement: a 3-year net yield path (illustrative)

Year 1: learning curve; Year 2: optimization; Year 3: stabilization. Compare year 3 net yields, not month 2.

Supplement: closing paragraph

Net yield is earned operationally, not granted by purchase price.

Final expansion: building a “management fee sensitivity” matrix

Hold revenue constant at $18,000/year and vary management from 15% to 22%:

Mgmt %	Fee USD
15%	$2,700
18%	$3,240
22%	$3,960

That swing alone is $1,260/year—more than CAM for many 50 sqm units.

Final expansion: building an OTA sensitivity matrix

Hold revenue constant and vary OTA commissions from 12% to 20%:

OTA %	Fee USD
12%	$2,160
16%	$2,880
20%	$3,600

Final expansion: closing

Fee percentages feel abstract until you translate them into dollars per year.

Supplement: a 24-month ramp assumption

Many units reach stable net performance after 12–24 months of listing optimization and reviews. Underwrite year two, not month two.

Supplement: closing paragraph

Net yield is a process, not a day-one promise.

Supplement (long-form): benchmarking net yield responsibly

When benchmarking, compare similar buildings, similar management, and similar channel mix. A direct-booking operator quoting 6% net is not comparable to an OTA-heavy operator quoting 6% net unless you normalize assumptions. Benchmarking is only useful when the fee stack matches.

Supplement: table: benchmark checklist

Item	Must match
OTA %	Yes
Mgmt %	Yes

Supplement: closing

Apples-to-apples yields only—everything else is noise.

Final note (disclaimer)

Illustrative yields are not guarantees. Actual results depend on occupancy, pricing, fees, tax treatment, and macro conditions—model conservatively.

Frequently Asked Questions

What net yield is realistic for Phuket condos? +

Many investors land in a roughly 4–6% net range after management, OTA, CAM, and taxes, but results vary widely by occupancy, pricing, and operations.

Why is gross yield higher than net yield? +

Gross yield excludes operating costs, commissions, building fees, and taxes. Those deductions can be large in short-term rental models.

Are OTA commissions always 15–20%? +

Rates vary by platform, promotions, and geography. Some bookings are direct with near-zero OTA fees, while others are heavily commission-dependent.

Is 15% tax on gross always correct? +

Not always. Tax rules depend on residency status and filing routes. Treat 15% as a planning illustration unless your accountant confirms.

How can I improve net yield? +

Common levers include direct bookings, strong listing optimization, competitive management fee negotiation, and controlling utility costs.

Related Guides

• /guides/thailand-property-tax-foreigners/ — tax context
• /guides/hidden-costs-buying-property-thailand/ — broader costs
• /guides/buying-property-phuket-guide/ — Phuket roadmap