Property market booming in Vientiane

Property market booming in Vientiane

The property market is growing very fast in Vientiane due to business expansion and development projects, according to a report by Colliers International Thailand in association with RentsBuy Co., Ltd.

The report stated that a significant amount of real estate activity is undertaken by diplomatic missions and Non Governmental Organisations (NGOs) in the form of villas and leased apartments for their own operations as well as residences for their expat employees.

Over the past 10 years Laos has also had a significant amount of hydropower development and is serving the energy needs of its neighbours as well as becoming an important mining destination and logistical hub for regional trade.

Many companies involved in these sectors, especially from Vietnam, China and Thailand, have now opened offices in Vientiane. A plethora of banks have also sprung up in the capital to serve the needs of these investors.

Laos has a liberalised financial sector and many foreign banks actively operate in Vientiane. Most occupy their own dedicated office building.

The report suggested that the highest demand for rental properties is in the US$500-US$800 per month bracket, while there is a reasonable level of demand for properties renting in the US$1,000 to US$1,500 category, especially from diplomatic staff.

Managing Director of RentsBuy Co., Ltd. Houmphan Salyalath told Vientiane Times on Friday that new rental accommodation, whether apartments or houses, was snapped up quickly when it came on the market.

“I observe that there is strong demand for rental property in the city centre in the US$500-US$600 price bracket,” he said, but was unable to quote exact figures concerning the number of rental properties in Vientiane and the rate of market growth.

Mr Houmphan estimated there are about 50,000 expat employees currently in Laos, including from Thailand, China and Vietnam. Of the total figure, at least 10,000 expat employees are thought to come from the West and Australia.

Most houses are stand alone rather than in estates although there is a growing trend for estates due to the higher level of security. Otherwise the tenant is responsible for this and some embassies even resort to providing private security for their staff, according to the property report.

Popular locations for expat renters are in diplomatic areas or near Vientiane International School and other schools that provide English language instruction. These properties are mostly in Sisattanak district.

Chanthabouly district is home to many offices and can be considered the main business district so many people prefer this area, which is also close to places of entertainment.

It is usually the custom for tenants to pay rent at least six months in advance but mostly with no security deposit, although a few landlords require this. The lease term is usually in the form of a one year contract while the tenant is responsible for paying their own bills.

Some tenants prefer a longer term lease if they are comfortable with the house and surroundings but most accept the greater flexibility of a shorter lease, according to the property report.

There is also some demand for house rentals in Luang Prabang district in the north of Laos for those working in the hospitality industry and in Savannakket and Pakxe in the centre and south of the country where many industries are located.

vientiane times