Real estate companies take risks to attract foreign clients
Real estate companies take risks to attract foreign clients
Real estate companies in Vietnam are struggling to attract foreign clients despite local authorities having failed to yet issue guidelines for the recently approved amended Law on Housing that allows foreign people to buy homes in the country.
Still waiting
Although the law took effect from July 1, statistics from real estate trading floors which are supplying houses and apartments in the centre of HCM City reveal that there have been only some 200 transactions.
General director of Hung Thinh Lan Co, Nguyen Nam Hien, said his company was supplying homes in both mid and high-class projects but were now only selling property to Vietnamese clients.
"Many Overseas Vietnamese have also come to see the projects since the new law took effect but they’re still waiting for the detailed guidance before deciding to buy," Hien said.
Tran Le Thanh Hien, general director of Danh Khoi Real Estate Co, said they were receiving many foreign and Overseas Vietnamese but few transactions had been completed. "They mostly asked their Vietnamese relatives to help sign the contracts," he said.
Some floors that are paying more attention to these foreign clients, such as Khai Hoan Land, Seareal and An Loc Dien but they have only been able to sell 80, 30 and 2 houses, respectively.
Taking risks
While waiting for more detailed government guidance, several companies have agreed to sell units with the proviso that they would return the money if the buyers are somehow later found to be ineligible or find the new guidance unacceptable.
Tran Hien Phuong, director of Seareal Co which is supplying several high-end projects including Vinhomes Central Park, Estella, Krista, and Masteri Thao Dien, said the company was obviously responsible for meetings its obligations it had agreed to in a contract with the buyers.
Nguyen Nam Hien of Hung Thinh Land Co said that they were potentially losing Vietnamese clients while taking deposits from foreign buyers, while detailed guidance had yet to be issued.
Meanwhile, lawyer Tran Thai Binh from LNT & Partners Law Company says that although the new Law on Housing took effect, there are still some terms needed to be made clear, such as definitions of eligible buyers, or how to supervise foreign individuals or organisations only own a maximum of 250 houses in a ward or a collective maximum of 30 percent of apartments in an apartment building.
According to chairman of HCM City Real Estate Association Le Hoang Chau, around 30,000 foreigners are working and living in HCM City. In addition, a lot of foreign peoples are working and living around the country, including 80,000 from South Korea and 8,000 from Japan.
"Such people have been living in Vietnam for years and that they can now buy their own homes should warm up the property market in cities and provinces with several industrial parks like HCM City, Dong Nai and Binh Duong provinces," Chau said.
He said authorities should issue detailed guidance on financial transactions for foreigners wanting to buy a home as well as outlining where foreigners were banned from owning houses due to supposed ‘national security’ issues.
