Last year’s introduction of the new law on housing and real estate has increased foreign investments
Night falls on a promenade by the Hàn River in Danang. Image credit: wegodi bookinghotel (Flickr)
Danang, the third largest city in Vietnam after Hanoi and Ho Chi Minh City, is becoming of increasing interest to foreign investment.
According to Savills Vietnam, which recently opened its first branch in the city, Danang has seen seven hotel and resort acquisitions worth USD20-60 million this year.
Overall, the hospitality segment is doing exceptionally well in the city, a former French colonial port that is now home to one million. Real estate experts note its proximity to China as a logical advantage, alongside an all-time-high boom in domestic travel.
“The best case study we can find is to look at the proximity of Mexico to the US, the growth of Mexican tourism, just because of its near proximity and warm weather,” Troy Griffiths, deputy managing director of Savills Vietnam, told Deal Street Asia.
“The second thing that a lot of people overlook is that we’re in the golden era of domestic travel for Vietnam. Vietnamese have never travelled as much as they are travelling now,” he said.
Visitors to Danang are composed of two-thirds to 70 percent domestic travellers, Griffiths reported.
More: Exciting growth for the Vietnam property market
Danang’s second home market is also thriving remarkably, selling 1,335 units in the first quarter of this year alone, a far cry from the 185 units sold in 2015, data from CBRE Vietnam shows.
An agency for Vietnamese real estate firm VinaCapital in Danang for six years, Savills Vietnam was emboldened to open a branch in the city due to its burgeoning, investment-ready property market.
“In the early days back in 2010, there were only two or three developments available. Now there are dozens of them,” said Griffiths.
Foreign capital is gushing forth in unprecedented volumes into the Vietnam market. In 2015, Vietnamese real estate was the third most attractive sector for foreign direct investment (FDI), drawing USD2.32 billion.
That same year, the new laws on Housing and Real Estate Business were implemented, dramatically relaxing ownership restrictions against foreign individuals and entities.
Vietnam has entered into a free trade pact with EU countries that will take effect within two years.
Read next: With USD2.32 billion in FDI, Vietnam real estate paints a rosy picture
Source : property-report.com
Read more…Danang, ascending: Vietnam’s third largest city takes the spotlight
