Foreign investors find property market attractive
With the lacklustre performance of real estate markets in the region, Vietnam has the high possibility of taking over other regional property markets. The real estate market of regional countries such as Malaysia, Singapore and China are not doing well, said Chen Lian Pang, Chief Executive Officer of CapitaLand Vietnam, told the media in HCMC recently.
He described the Myanmar housing boom as a “bubble” with “no fundamentals to support that kind of pricing.”
Such favourable conditions are supplemented by the high rental yield in Vietnam as compared to other countries in the region, he said. “[In Vietnam] easily you can get 6% or 7% rental yield.”
In other regional countries such as Singapore, rental yields are “2 to 3%” and bank interest rates are “a-point-something percent”. Therefore, he added, from the investor’s angle on rental yield it is attractive here in Vietnam.
Supported by strong economic growth, young workforce, and government policies aimed to open up the market, Vietnam is becoming one of the most exciting countries in the region to invest. Structural reforms and a stabilised economy will allow Vietnam to have greater opportunities for economic development. Currently, Vietnam is Asia’s fifth strongest growing economy.
However, Chen made clear that bureaucracy and processes needed to be streamlined and simplified to attract larger numbers of foreign investors.
Foreign investors also need to take some risk of dong depreciation when investing in Vietnam, which has caused uncertainties. “I do not know which way it will go,” Chen said.
Chen, however, said he is confident that a lot of infrastructure was being built in Vietnam by the Government, and these efforts would translate into upcoming developments in District 2, HCMC and Long Thanh, Dong Nai Province with the construction of a new international airport.
“The growth is in this direction and real estate will follow the infrastructure development, so this is the right area,” he said.
CapitaLand, one of Asia’s largest real estate companies headquartered and listed in Singapore, has launched several residential projects in Vietnam with Vista Verde being its fourth. CapitaLand’s other prime residential developments in Vietnam include The Vista, ParcSpring, both in District 2, HCMC, and the Mulberry Lane in Ha Dong District, Hanoi.
