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Local players remain dominate in real estate
Local investors will continue to be main players in the real estate market in the short and medium term, and will seek assets from foreigners looking to leave the market, an international conference heard last Saturday.
Managing director of CB Richard Ellis Viet Nam Ltd. Co, Marc Townsend, told the Viet Nam International Real Estate Conference in HCM City that more real estate assets will be offered for sale in the near future.
"Vietnamese tycoons will look for land banking opportunities when the market is considered to be at its ‘bottom’, he said.
Townsend presented some economic fundamentals that would impact the local property market, in particular a stock market boom that has risen sharply from a low of 223 in February to more than 500 in June, and a current fall to 416. Other factors include lower inflation and bank interest rates as well as an increase in the supply of rental apartments and residences in big cities, he said.
However, "Foreign property funds with capital reserves will continue to find it difficult to enter the market as country risk margins and low returns on completion make many potential projects unfeasible at existing property asking prices," he noted.
On the other hand, Viet Nam has also effected legal changes to benefit foreign investors. Foreign developers can now be assigned property and can bid for sites at Government auctions and companies are allowed to buy 100 per cent of the capital of Vietnamese companies instead of the 30 per cent cap maintained earlier.
Recent initiatives like the establishment of real estate trading floors and online information sites will increase sales transparency slightly, he said.
Government’s stimulus package helped businesses cope with the economic crisis.
Presenters at the conference organised by the G4B Branding Real Estate Marketing Company and a host of co-sponsors also sketched market trends in Australia, Europe and the US, inviting investment into these markets as well.
A few major projects in cities nationwide were highlighted at the conference including the CT Plaza in HCM City and Viet Tower in Ha Noi.
A series of new trade centres had been put into operation, like the Now Zone and Lotte Mart in HCM City, Big C in Hue, the Garden Lifestyle Mall in Ha Noi and Metro in Dong Nai, the conference heard.
Townsend advised investors to consider several factors, including location, resale opportunities, rental demand and prices in the area as well as future development plans before deciding on long-term real estate investments in the country.
At the conference, local property companies offered some potential real estate projects to local and foreign investors, like the Ben Luc-Long An, Phuoc Long A, Phuoc Long B and Truong Tho residential areas as well as a hotel and commercial center project in Da Lat City.
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