Investors homing in on real estate

Tran Nhu Trung, associate director of Savills Vietnam, said the government’s recent monetary tightening had alarmed investors who were seeking new investment channels to help them avoid future capital devaluation.

“Cash holders have found realty investment an interesting way to keep their capital away from inflationary hikes and currency devaluation as well. Meanwhile, a large portion of the country’s young population is still in need of homes especially in the big cities like Ho Chi Minh City and Hanoi,” Trung said.

IHowang Yu Nam, general director of Daewon Construction Limited Company - which recently launched model houses for its Cantavil Premier An Phu project in Ho Chi Minh City’s District 2 - said: “Regardless of the current flat market situation, we have decided to launch our project looking to meet demands of rich people fighting dong devaluation.”

He added that with an appropriate promotional programme, the right pricing and exclusive products, they expected to sell well.

Ho Chi Minh City and surrounding provinces have also recently seen many other residential projects launching their sales programmes to tune into concerns over capital devaluation.

These projects include Thanh Yen Joint Stock Company’s Thanh Da View residential project in Binh Thanh district, Thu Duc Housing Development Company’s Phuoc Binh residential project in District 9, Dai Thanh Real Estate Company’s Dai Thanh project in Tan Phu district, and SetiaBecamex Joint Stock Company’s Ecolakes in Binh Duong province.

Leong Swee Chow, general director of SetiaBecamex, said: “Real estate is now one of the best investment options available, but investors need to look for quality products from reliable developers.

“Real estate, especially good quality residential and commercial properties, is virtually recession-proof. They [property investments] are the best hedge against inflation and ensure that you get the best returns on your investment.”

According to CBRE quarterly report, the Ho Chi Minh City residential market saw 5,827 new apartment units launched onto the market in the first three months of the year, a 103 per cent increase against the fourth quarter last year. Continuing the trend seen over the last year, the new launches were concentrated in the affordable sector of the market.

The real estate consulting firm also said that trading floors were reporting increases in inquiries of 30 per cent quarter-on-quarter, although the number of deals closed decreased 36.6 per cent in the first quarter.

Buyers were looking for a place to park their cash as inflation and dong devaluation limited the returns from bank deposits, and this was the reason for the higher number of inquiries, CBRE report stated.