Positive year ahead for Vietnam real estate this 2015, says CBRE
Positive year ahead for Vietnam real estate this 2015, says CBRE
In line with the improving economy, Vietnam’s property sector has seen positive improvements in the last few quarters and looks set to having a strong sales year in 2015.
CBRE Vietnam predicts in its Fearless Forecast 2015 report that the local residential market, including the luxury, high-end and affordable segments, will have a good year, with new launches and several stalled developments restarting their operations, as well as foreign direct investment increasing.
In the new report, CBRE Vietnam states the recovering real estate industry last year witnessed significant movements, such as recording the highest number of condominium units sold at 17,000 in the history of Ho Chi Minh City (HCMC). Hanoi also had a good year in terms of sales, with 10,700 units sold in 2014, a 50 percent increase, year-on-year.
Supported by the country’s real Gross Domestic Product, which grew to 6.96 percent by the end of 2014 – up from 5.06 percent in the first quarter of last year – and headline inflation that had an average of 4.09 percent in the last 12 months, Vietnam’s top property markets are predicted to witness a positive year ahead.
In particular, HCMC has been named as one of Asia-Pacific’s better investment and development prospects. The city placed tenth in the region based on development prospects, and it came in 13th place in the investment radar.
The country’s Free Trade Agreements (FTA) with other nations and organisations also created opportunities for Vietnam to transform itself as a desirable investment destination. The agreements include the FTA with the Customs Union of Russia, Belarus and Kazakhstan, which concluded last December; the ASEAN Economic Community at the end of this year; and the Trans-Pacific Partnership European Union FTA, which is still under negotiations.
Meanwhile, new policies, such as allowing foreign invested firms to purchase a completed building for their own use, and sub-leasing properties that they are renting, both of which will take effect in July 2015, could bode well for the country’s office market.
Elsewhere, infrastructure developments, including the Metro Line No. 2 Cat Linh–Ha Dong construction in Hanoi, the completion of Noi Bai International Airport Terminal 2, and the opening of more roads, bridges and highways both in Hanoi and HCMC, could drive up demand for residential, commercial and retail projects, as well as continuing the increasing trend in primary prices due to limited supply.
Among the local developers with high-profile residential projects under development or construction this year include VinGroup, NovaLand, Nam Long and FLC Group. CBRE Vietnam stated in the report that pre-sales and pre-launch marketing activities remain popular among target buyers across various segments.
