\nWill the impact of the Law on Residential Housing be felt in 2016?<\/p>\n
This is the conclusion of\u00a0Property Report\u2019s three-part series on the rebirth of Vietnam\u2019s property market. Read\u00a0Part One and Part Two here.
Will the impact of the Law on Residential Housing be felt in 2016? This is...<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":"","jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true},"categories":[1],"tags":[],"class_list":["post-16070","post","type-post","status-publish","format-standard","hentry","category-property-news"],"jetpack_featured_media_url":"","jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p75ss1-4bc","jetpack-related-posts":[{"id":9014,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/why-hcmcs-residential-market-will-prove-to-be-a-sustainable-investment\/","url_meta":{"origin":16070,"position":0},"title":"Why HCMC\u2019s residential market will prove to be a sustainable investment","date":"March 24, 2016","format":false,"excerpt":"\r There are abundant opportunities in Vietnam\u2019s real estate A statue of Ho Chi Minh stands in front of the City Hall building By Aidan Wee Just months after the liberalisation of Vietnam\u2019s Housing Law on 1 July 2015, allowing for foreign property ownership, the majority of foreign buyers have\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4068,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/apartments-buildings-in-vietnam-may-soon-follow-3-tier-classifications\/","url_meta":{"origin":16070,"position":1},"title":"Apartments buildings in Vietnam may soon follow 3-tier classifications","date":"February 8, 2016","format":false,"excerpt":"\r The ABCs of Vietnam\u2019s construction ministry proposal that got people talking Hanoi | Image credit: St. Rosenzweig (Wiki Commons) A draft circular proposed by Vietnam\u2019s Ministry of Construction is drawing mixed reaction from industry players and experts in the country, according to Vietnam News, with some developers welcoming the\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.siamlandbank.com\/propertynews\/wp-content\/uploads\/2016\/02\/Hanoi_St.-Rosenzweig.jpg?fit=740%2C518&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":87287,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/vinhomes-raises-1-35bn-in-vietnams-biggest-share-offer\/","url_meta":{"origin":16070,"position":2},"title":"Vinhomes raises $1.35bn in Vietnam\u2019s biggest share offer","date":"May 7, 2018","format":false,"excerpt":"\r Vietnam\u2019s largest residential developer prices shares at top of marketed range\r \r Source : ft.com\r Read more...Vinhomes raises .35bn in Vietnam\u2019s biggest share offer","rel":"","context":"In "Property 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leaders grapple with debt","date":"May 20, 2016","format":false,"excerpt":"\r Amorphous government reflects preoccupation with economic and political stability\r \r Source : ft.com\r Read more...Vietnam\u2019s new leaders grapple with debt","rel":"","context":"In "Property 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\nBy Thomas Maresca
\nThe changing nature of buyers and the diversity and quality of developments have developers and brokers in Vietnam feeling more confident that this renaissance is not another property bubble in the making.
\nIn addition to owner-occupiers buying with mortgages, another new addition to the housing market has been foreign owners. On 1 July 2015, Vietnam\u2019s housing laws were updated to allow overseas investors to own up to 30 percent of units in an apartment complex and 10 percent in villa and townhouse complexes.
\n\u201cWith the amendment to Vietnam\u2019s Housing Law, the country\u2019s property market offers long term growth potential and opportunities for foreign investors,\u201d notes\u00a0Linson Lim, president of Keppel Land Vietnam.\u00a0\u201cThis is an important step towards opening up the Vietnam real estate market to overseas investment.\u201d
\nHard numbers are difficult to come by, but Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association (HoREA), said they had counts of roughly 700 foreigners purchasing apartments in Ho Chi Minh City (HCMC) since the law came into effect.
\n\u201cBut I think the real number is higher,\u201d says Chau.
\nAnother key factor driving residential property growth is the major infrastructure improvements underway. The first line of HCMC\u2019s metro, connecting Ben Thanh Market with Suoi Tien Park in District 9, is scheduled for completion by 2020. Hanoi\u2019s first of six metro lines is scheduled for completion in 2018. In both Hanoi and HCMC, the metro acts like a magnet for property developers, with many of the major projects located in close proximity to train lines.
\nMore:\u00a06 facts foreigners need to know about Vietnam\u2019s new laws
\nIn the big picture, Vietnam\u2019s residential property market is beginning to look a lot less like the speculative dice roll of 2005-07 and more like something that has deeper roots for growth.
\n\u201cAt the moment we\u2019ve got lots of money chasing lots of stock,\u201d says CBRE Vietnam\u2019s managing director Marc Townsend. \u201cAnd lots of buyers. So it\u2019s a much healthier relationship, whereas before it was too much money chasing too little stock, with limited numbers of buyers.\u201d
\nNor have property prices grown to bubble-like proportions. The range of high-end properties in HCMC remains in the USD2,500-2,900 per sqm range, with the very top tier of the luxury market tipping up to around USD7,500 per sqm, per CBRE. Meanwhile, luxury condominiums routinely fetch USD7,500-10,000 per sqm. Equivalent units in Singapore can command upwards of USD25,000.
\nOf course, that\u2019s not to say that there aren\u2019t a number of potentially destabilising factors worth keeping an eye on. Townsend says he\u2019s watching the \u201c5 Cs\u201d: Currency, China, Commodities, Climate and Competition.
\nCertainly China and the climate have already shown an ability to shock markets, with China\u2019s early-year stock market plummet and slowing economy a drag on the region, and climate change becoming a serious threat to Vietnam\u2019s agricultural areas \u2013 which can potentially lead to an influx refugees fleeing to urban areas like HCMC.
\nMore: Why HCMC\u2019s residential market will prove to be a sustainable investment
\nThe spectre of the last bust also still haunts the market. The State Bank of Vietnam recently issued a draft of Circular 36, which looks to tighten the flow of credit to the real estate sector. The maximum ratio of short-term funds used for medium and long-term loans will be reduced from 60 to 40 percent and the risk index of receivable lending for real estate will be raised from 150 to 250 percent.
\nNeil MacGregor, managing director of Savills Vietnam,\u00a0believes the tightening actions will benefit the market. \u201cI think it\u2019s a good thing that the government should be controlling credit, controlling lending to real estate developers.
\n\u201cIt means that the developers have to really think through their feasibility studies and make sure that they have carefully considered who their target market is before proceeding with their projects,\u201d he adds.
\n\u201cAnd it hopefully restrains developers launching very large-scale projects without considering phasing and other measures to bring a project to market.\u201d
\nVietnam is anticipating another round of economic development, spurred by looming free-trade agreements such as the Trans-Pacific Partnership, the impact of which is hard to project with accuracy.
\nThere are countless moving parts necessary to keep this robust real estate market going, but with pent-up demand and macroeconomic strength fuelling the current upturn the cranes don\u2019t look like they\u2019ll stop turning anytime soon.
\nThis article originally appeared in\u00a0Property Report\u00a0magazine\u2019s Issue no. 136.
\nRead next: Why 2016 will be a solid year for Vietnam real estate
\n
\nSource : property-report.com
\nRead more…What the foreseeable future holds for Vietnam\u2019s property sector<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"