Illustrative photo. (Source: VNA)
Hanoi (VNA) - Property consultantsSavills Vietnam have adopted a positive outlook on real estate investment in Vietnamamid the COVID-19 pandemic, saying that when it eases there will be increasingnumbers of investors injecting new capital into the sector.
According to its most recent report, residential real estate is experiencing a short-termnegative impact as travel bans are preventing buyers from visiting and closing deals,especially given that China, the Republic of Korea, and Japan account for a largeproportion of foreign demand.
Developers, however,have prepared strong project pipelines in order to be ready when local and foreigndemand return to previous levels, as Vietnam still has among the lowest real estateprices but highest rental yields in the region.
This is a difficultperiod for local and international property investors, according to Dr. Su Ngoc Khuong,Senior Director of Savills Vietnam. In his opinion, for cash-rich investors with experience inthe sector, however, it is also a time of great opportunity in Vietnam and overseasas those that have over-extended undertake rapid divestment.
He noted that onetrend on the rise since last year is investor groups seeking to partner with othersto develop larger-scale M&A opportunities. There are deals of this nature inVietnam currently under negotiation and valued at well over half a billion dollarsin total, Khuong added.
A variety of governmentincentives have been put in place in response to the challenges posed by the outbreak,including tax breaks and the suspension of tax payments and land rentals for businesseshurt by the COVID-19.
A credit packageof 250 trillion VND (10.6 billion USD) and supportive measures such as reschedulingand reducing interest rates, maintaining current loan classifications, and reducingfees, among others, will also be offered to enterprises facing difficulties dueto the outbreak.
In order to supportenterprises and improve the business environment, the Government has also askedrelevant authorities to review and reduce administrative procedures and speed upthe disbursement of investment capital.
The latest robustGovernment directives are being implemented to support property and business throughoutthis period of slowdown. “With increased liquidity and a potentially rich investmentenvironment, we anticipate that when the pandemic eases, more and more investorswill pour new capital into Vietnam’s real estate sector,” Khuong said./.
