Vietnam’s property market has shown signs of recovery after a longperiod of stagnation, heard a symposium held in Ho Chi Minh City onSeptember 11.
Speaking at the "Vietnam Real Estate Symposium, 20years looking back and two years looking forward" symposium", NguyenTran Nam, Deputy Minister of Construction, said that property prices hadnot increased and were now selling at reasonable prices, especially inthe mid-range housing segment.
As for the high-end market, theprices of property projects in the western area of Hanoi felldramatically, by 60 percent from 2011-2013. For the first half of theyear, prices remained stable, with some project prices increasing by 1-2percent only.
The number of transactions had gone up as well, hesaid. Around 5,100 transactions were completed in Hanoi in the firstseven months of the year, or double the figure over the same period lastyear.
In HCM City, there were 4,500 transactions in the firstseven months, a rise of 30 percent compared to the same period lastyear. As of August 20, the total value of real estate inventory was82.295 trillion VND (3.9 billion USD), a drop of 46.254 trillion VND(2.2 billion USD) compared to the first quarter of last year. FromDecember 31, 2013 to June 30, 2014, the total credit balance forproperty had increased by 7.7 percent to reach 282.2 trillion VND (13.3billion USD). At least 20 percent of the government's housing creditpackage worth 30 trillion VND (1.4 billion USD) had been disbursed.
Theproperty market has attracted a large amount of foreign directinvestment (FDI). There are a total of 427 FDI property projects in thecountry, with total registered capital of 51 billion USD, ranking secondafter the processing industry.
Foreign direct investment in thereal estate market accounts for 21 percent of total FDI in Vietnam.According to Savills Vietnam, the office-for-lease segment grew by 1.6to 5 percent in most big cities in Asia Pacific, including Hanoi and HCMCity, in the first half of the year.
Troy Griffiths, DeputyManaging Director of Savills Vietnam, said Vietnam's property leasingprices were competitive compared to other countries in the region,especially in the hotel, retail and serviced apartment segments.
MarcTownsend, Managing Director of CBRE Vietnam, said that HCM City andHanoi were still the top target markets for property retailers.
Experts who spoke at the meeting said that high-end projects of a large scale were still the primary focus of developers.
However,only 20 percent of consumers can afford property in this segment, theysaid. Also, many property investors have to rely on short-term loanswith high interest rates, while many small businesses that have weakfinancial capacity continue to take part in the market.
Thecountry now has 15,316 property businesses. Of that number, 8,603businesses have chartered capital of less than 20 billion VND (944,000USD).
At the meeting, many foreign investors expressed concernsabout lack of transparency and complicated administrative procedures inthe real estate market.
They said a more open investment environment should be created.
Toresolve these issues, the Vietnamese Government has issued manypolicies and incentives to ensure sustainable development of the market.
Theseinclude measures to control supply-demand balance; review andevaluation of projects; resolution of non-performing loans; and moreloans to customers so they can buy houses.
The Ministry ofConstruction has also advised the Government to amend real estatebusiness laws and housing laws with content that provides morefavourable conditions to foreign businesses and foreigners to invest inreal estate as well as rent and lease houses and land in Vietnam.
Thesymposium, held by the Australia Chamber of Commerce in Vietnam(Auscham), aimed to discuss the latest development in Vietnam's propertysector, market insights, advice on attracting local and foreigninvestors, an upgrade on Law and Tax changes, and networkingopportunities with key parties and well-known figures in the real estateindustry.-VNA
Speaking at the "Vietnam Real Estate Symposium, 20years looking back and two years looking forward" symposium", NguyenTran Nam, Deputy Minister of Construction, said that property prices hadnot increased and were now selling at reasonable prices, especially inthe mid-range housing segment.
As for the high-end market, theprices of property projects in the western area of Hanoi felldramatically, by 60 percent from 2011-2013. For the first half of theyear, prices remained stable, with some project prices increasing by 1-2percent only.
The number of transactions had gone up as well, hesaid. Around 5,100 transactions were completed in Hanoi in the firstseven months of the year, or double the figure over the same period lastyear.
In HCM City, there were 4,500 transactions in the firstseven months, a rise of 30 percent compared to the same period lastyear. As of August 20, the total value of real estate inventory was82.295 trillion VND (3.9 billion USD), a drop of 46.254 trillion VND(2.2 billion USD) compared to the first quarter of last year. FromDecember 31, 2013 to June 30, 2014, the total credit balance forproperty had increased by 7.7 percent to reach 282.2 trillion VND (13.3billion USD). At least 20 percent of the government's housing creditpackage worth 30 trillion VND (1.4 billion USD) had been disbursed.
Theproperty market has attracted a large amount of foreign directinvestment (FDI). There are a total of 427 FDI property projects in thecountry, with total registered capital of 51 billion USD, ranking secondafter the processing industry.
Foreign direct investment in thereal estate market accounts for 21 percent of total FDI in Vietnam.According to Savills Vietnam, the office-for-lease segment grew by 1.6to 5 percent in most big cities in Asia Pacific, including Hanoi and HCMCity, in the first half of the year.
Troy Griffiths, DeputyManaging Director of Savills Vietnam, said Vietnam's property leasingprices were competitive compared to other countries in the region,especially in the hotel, retail and serviced apartment segments.
MarcTownsend, Managing Director of CBRE Vietnam, said that HCM City andHanoi were still the top target markets for property retailers.
Experts who spoke at the meeting said that high-end projects of a large scale were still the primary focus of developers.
However,only 20 percent of consumers can afford property in this segment, theysaid. Also, many property investors have to rely on short-term loanswith high interest rates, while many small businesses that have weakfinancial capacity continue to take part in the market.
Thecountry now has 15,316 property businesses. Of that number, 8,603businesses have chartered capital of less than 20 billion VND (944,000USD).
At the meeting, many foreign investors expressed concernsabout lack of transparency and complicated administrative procedures inthe real estate market.
They said a more open investment environment should be created.
Toresolve these issues, the Vietnamese Government has issued manypolicies and incentives to ensure sustainable development of the market.
Theseinclude measures to control supply-demand balance; review andevaluation of projects; resolution of non-performing loans; and moreloans to customers so they can buy houses.
The Ministry ofConstruction has also advised the Government to amend real estatebusiness laws and housing laws with content that provides morefavourable conditions to foreign businesses and foreigners to invest inreal estate as well as rent and lease houses and land in Vietnam.
Thesymposium, held by the Australia Chamber of Commerce in Vietnam(Auscham), aimed to discuss the latest development in Vietnam's propertysector, market insights, advice on attracting local and foreigninvestors, an upgrade on Law and Tax changes, and networkingopportunities with key parties and well-known figures in the real estateindustry.-VNA
