Full resumption of international tourism expected to boost resort real estate in Vietnam

The Government Office has just conveyed the direction of Prime Minister Pham Minh Chinh on building a safe, systematic and effective opening schedule to welcome international tourists.

In this direction, the PM requested the Ministry of Culture, Sports and Tourism to assume the prime responsibility for international tourism opening, in coordination with ministries of health, national defence, public security, foreign affairs, transport, and information and communication.

Travel, accommodation, and transportation sectors, as well as the resort real estate market, will likely benefit from this initiative. The economic slowdown and business disruptions have been exacerbated by the latest wave of infections.

At the moment, Vietnam is contemplating completely reopening the country to foreign visitors by May 1, but many people believe it should happen sooner rather than later.

In the wake of social distancing and rising prices of building materials, the majority of real estate projects throughout the country have been put on hold, particularly in the resort real estate segment.

Condos, beach villas, and shophouses have all seen a dramatic fall in customer demand as well as financial liquidity over the previous two years.

Hence, the long-awaited resumption of international routes is slated to considerably spur the vast potential for tourism and resort real estate recovery.

Pham Sy Hoang, CEO of Thu Thiem Real Estate Investment JSC, said that the move would pave the way for a "positive rebound of the sector". Tourism has been "clinically dead" for more than a year, with a knock-on effect on resort real estate.

"Projects with good infrastructure, prime locations, and developed by reputable operators will definitely continue to attract visitors," Hoang said.

Le Khac Hiep, vice chairman of Vingroup – a notable real estate developer in the country – shared that Vingroup’s resorts are ready to welcome both international and domestic tourists.

"Before the pandemic, Vingroup inaugurated several key tourist facilities, among which are three large establishments in south Hoi An, Phu Quoc, and Nha Trang. All of them are ready to offer customers premium services such as golfing, fine dining, swimming, and other forms of entertainment," Hiep shared.

Previously, according to the 3-phase roadmap of international tourism resumption, five localities were selected to receive international visitors through packaged travel programmes in the first phase from mid-November. Many provinces have since taken advantage of this opportunity. For example, Quang Nam officially welcomed three international delegations to Hoi An on November 17, 18, and 25. Phu Quoc also followed suit by welcoming a group of 209 international tourists after nearly two years of lockdown.

Experts forecast that the number of tourists will continue to increase rapidly soon.

Real estate projects that are financially and operationally sound are believed to maintain their momentum. Wellness tourism, which combines physical and mental health, is likely to be the emerging trend in the post-pandemic era.

It used to be assumed that tourists were solely interested in entertainment, but that has changed in the last two years, stated Vu Van Thanh, chairman of the Board of Directors cum CEO of VNGroup. The new trend has shifted towards health tourism and exploring indigenous cultures. As such, a large number of investors have also caught up with the movement.

Hoang Lien Son, CEO of Alpha Real Estate Brokerage and Investment JSC, reinforced his belief that the pandemic has somehow raised awareness of health and wellbeing. In major tourist destinations like Phu Quoc, Danang, Nha Trang, and Halong, investors have swiftly embraced a health-conscious approach.

"The concept of an all-in-one experience is enticing travellers. A resort complex that has been built by well-known developers and has a lot of amenities will be a prominent choice. This applies to not only domestic but also international tourists," Son stated.