Northern investors migrating south
Northern investors migrating south
There has been a rising trend of Hanoians buying properties in central and southern provinces.
A range of project developers have begun launching their projects to the Hanoi market in response to an increasing demand from the capital city for properties in the central and southern regions of the country. Such developers include Phu My Hung, VinaCapital, CapitaLand, Kepple Land and many others.
During the recent launch of The Point project to the Hanoian market, a representative from VinaLiving (of VinaCapital) said that Hanoian buyers dominated its projects, with around 70 per cent of total buyers coming from the capital.
“Properties in the south and central provinces are attractive to Hanoians, as they can buy-to-lease the properties, or purchase them as investment opportunities,” said Matthew Koziora, director of Transaction at VinaLiving.
NovaLand recently introduced a number of apartments located in Ho Chi Minh City to the real estate market in Hanoi. Among those, about 300 units from The Sun Avenue were introduced to the northern buyers.
According to Duong Hong Cam, executive director of The Sun Avenue, NovaLand has built many large scale projects such as the Sunrise City, The Prince Residences, Tropic Garden and Lexington Residence. Many of those, Cam said, were highly sought after by buyers from the northern region.
“We are looking for buyers who want to find a property and sublease it for a profit. The profit levels of buy-to-let in Ho Chi Minh City are now relatively high – up to 8 per cent per year,” said Cam.
Pham Thanh Hung, general director of STDA property transaction centre, the distributor of The Sun Avenue said that he aimed to attract northern buyers who are living in Ho Chi Minh City.
According to Hung, in district 7, around 40 per cent of purchases were made by northern buyers. “Projects in district 2 have more advantages, such as improved infrastructure, and will surely attract more northern buyers,” Hung said.
“In order to be attractive to northern buyers, properties must be proven to return high profits. According to our estimation, the profit level of high-end apartment projects in the Ho Chi Minh City centre could be up from 7 to 8 per cent, compared to levels in Hanoi of only 3 to 4 per cent,” Hung said.
In addition, other factors that attract northern buyers to properties in Ho Chi Minh City are the high population density and a higher amount of foreigners.
Meanwhile, properties in the central tourist hotspot city of Nha Trang are also popular among buyers from Hanoi and Ho Chi Minh City. According to Savills Vietnam, up to the second quarter of this year, Nha Trang has more than 2,800 units from 10 projects. Almost all of those projects are located in the beachfront area, especially in Tran Phu street, with the average price ranging from VND23million to 60 million ($1,095 to $2,857) per square metre. The most desired units are typically one and two bedrooms, and they significantly easier to lease.
Savills also reported that the majority of these buyers came from Hanoi and Ho Chi Minh City with the desire to secure a property as a second home or a buy-to-lease investment.
