Vietnam Real Estate
Vietnam has come out a long way from the dark chapter of the Vietnam War. In a survey done by the Association of Foreign Investors in Real Estate, Vietnam ranks as the fourth emerging global real estate market after Brazil, China, and India. With its strong economy, growing middle class, growing urban population, rising tourists numbers, Vietnam real estate market will grow at a fast pace and no wonder global real estate investors are paying more attention to Vietnam real estate than ever before.
Before 1990, Vietnam had no real estate market as everything was owned by the state. As a result of the "Doi Moi" reform that was introduced in 1986, the first laws recognizing the concept of private ownership came into effect in 1990 and 1998. From 1998 to 2004, there were several revisions and reforms took place. Due to these new reforms and revisions, starting in 2004 the real estate market in Vietnam started to attract foreign interests and investments.
Author/Copyright: Ahmed Dawn www.adawnjournal.com
Starting in 2009, legal foreign residents (after meeting certain conditions set by the government) in Vietnam are allowed to purchase property in certain areas under a 50-year leasehold. The property can also be resold after 12 months of ownership. Vietnam does not allow foreigners to have freehold property.
Vietnam is home to about 90 million people. The majority of its population live in the countryside. However, the residential sector is currently showing strong growth due to the rising income of the middle class and their willingness to purchase their own residential places. Demand for Vietnam’s two major cities such as Ho Chi Minh City and Hanoi is strong and it is estimated that the properties that are coming to the market will not be enough to meet its demand. The office market also shows strong demand for quality spaces, as the occupancy rate is around 95 percent. The leisure and resort markets are also going through strong demand. Vietnam has 3,000 kilometers coastline and its tourist numbers and accommodations have increased significantly. Hotels, resorts, and villas have high occupancy rates in this sector and real estate demands will increase in the coming years. The World Travel and Tourism Council predicts that Vietnam will be one of the top ten tourist destinations in the next ten years.
The property market in Vietnam still offers low entry prices with growth potential in the future. However, because it is an emerging market, transparency still can be an issue. Having a local partner or agent is a huge advantage dealing with real estate issues in Vietnam. Also, keep in mind that all real estate transactions are carried out in pure gold. Real estate investors need to pay close attention to gold prices and conversion rates.