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Foreigners hold 90 percent of real estate service market
The real estate service market (Marketing, distribution, assessment, investment consultancy and real estate project management) is now in the hands of foreign companies.
Foreign control
Real estate developers can generally sell products only when they use distribution services provided by foreign companies. According to the director of a real estate firm in HCM City, there “Big Three” are CBRE Vietnam, Savills Vietnam and Colliers, which together hold some 90 percent of the market share. The rest goes to the handful of Vietnamese service providers, such as Megagroup, Eden, Him Lam and VietRees.
Most recently, Knight Frank, the leading British real estate consultant firm (207 offices in 43 countries) announced its presence in Vietnam. Though a newcomer, this is a redoubtable rival with many advantages.
The companies have long-term experience in real estate. Colliers has been in Vietnam for 14 years, Savills has been around for 15 years, while CBRE has achieved nine years, and all of them have their own advantages.
CBRE, for example, has advantages in real estate valuation and leasing office management, while Savills is keen on investment consultancy and apartment management service, and Colliers is noted for high grade apartment management.
Savills Vietnam Director Brett Ashton admitted the necessity of keeping a keen eye on all arriving companies, especially Vietnamese companies, as they this will create fierce competition. According to Ashton, other companies may damage the troika-like position in the market, including Knight Frank Vietna, Jones Lang LaSalle and Cushman & Wakefield
Vietnamese companies are considered to have advantages in understanding the home culture and habits, but they are still inferior to foreign companies.
According to Nguyen Xuan Chau, Director of Megagroup (Established in early 2010), foreign companies now have many years of experience, plus good management technologies. Only a few Vietnamese companies can compare and the rest need time to create a reputation and gain customer confidence.
Chau added that some foreign real estate investors used Vietnamese companies, believing that they understand the tradition and culture better.
He noted that even though his company is a newcomer, the company has 14 investment consultant contracts with big economic groups from the Middle East. His company has been assigned to distribute products for big projects like Sun Villas in Da Nang and Sun City apartments.
Meanwhile, Bui Tien Thang, Deputy General Director of Sacomreal, noted that the service fee of foreign companies is always higher by 20-30 percent than that of domestic companies, while the quality is the same.
Thang admitted, however, that real estate developers still prefer using foreign services, because domestic companies are not well-developed and there is no big domestic brand name in the field yet.
vietnamnet,SGTT
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