Property market to see strong impetus: VCCI chairman

Hanoi (VNA) – In the time ahead, on top of the capable handling of COVID-19, the FDI inflow to Vietnam and its economic resilience will provide a strong impetus, help relieve the supply bottleneck and bring a breath of fresh air to the real estate market, said Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc.

New momentum for market

Speaking at a forum on July 16, Loc said this year’s property market has witnessed many new driving forces thanks to several factors, including amendments to legal regulations on property construction and business, the application of marketing technology and promotional incentives to boost property sales.

In particular, the extension of tax payment deadlines and the alleviation of financial obligations, which were driven by the COVID-19 outbreak and have been carried out throughout 2020 and 2021, have also proved helpful for banks and real estate enterprises.

The VCCI chairman noted in 2021, interest rates have been cut down to a record 15-year low, adding that lower interest rates are always a good stimulus for the real estate market. Lower interest rates help reduce the cost of capital and relax debt repayment rules, thus creating more favourable conditions for families and young people to buy housing and make investments.

In addition, exports have been on the rise thanks to newly-signed free trade agreements, tourism is expected to bounce back and more foreign investors will be permitted to enter Vietnam. Flexible macroeconomic and microeconomic policies will also help fuel the property market.

The above-mentioned factors are expected to help address the supply shortage and give a breath of fresh air to the market, Loc stressed.

Real estate remains top investment choice

However, global supply chains will be reshaped while technology will keep changing in the future, Loc pointed out, recommending businesses make swift preparations to overcome challenges and capitalise on opportunities during a post-crisis economic recovery.

In an effort to tackle difficulties facing the property market in 2019, the VCCI submitted a brief report on the overlap of legal documents on investment, land, construction, environment, housing, real estate business, and bidding to the Prime Minister.

Basing on the VCCI proposal, the National Assembly’s Committee for Legal Affairs set up a body to review the overlap of legal regulations.

The Prime Minister, ministries, sectors and localities have continually issued directions to further support property investors and developers, Loc went on.

He added that while the COVID-19 pandemic has yet to ease and investors remain prudent in putting money into gold and securities, real estate still proves to be the most attractive investment channel despite market changes during the social distancing period.

The VCCI leader believes that there will be more opportunities for investment in the property market in 2021, which also requires companies and investors to proactively change their mindsets and business models.

A representative of Batdongsan.com.vn, a member of PropertyGuru - a group owning Asia’s leading property tech platforms, believes that the COVID-19 pandemic poses risks but also creates opportunities for the property market.

Notably, the market recorded a year-on-year surge of 60.4 percent in the number of new property firms set up in May, a sign believed to be positive for the market’s recovery this year.

Dinh Minh Tuan, Director for the southern region of Batdongsan.com.vn, said in the long term, Vietnam’s real estate will always be a potential market as the urbanisation rate of the country is 35 percent, much lower than the 50 percent in Thailand and over 60 percent in China, not to mention the considerable demand from a population of nearly 100 million.

Besides, Tuan believed that real estate remains a safe haven that guarantees both safety and profitability in the case of economic crises./.