Property developers eye emerging markets

Dong Nai Province. Transport infrastructure development is promoting the growth of the real estate market in areas surrounding HCM City. - Photo 24h.com.vn

The southern property market is seeing an increasing trend of investors looking to the southern hub’s neighbouring provinces.

With land running out for property development in the city, investors are eyeing markets like Dong Nai, Binh Duong, Vung Tau, Long An and Binh Phuoc where prices are more reasonable and have significant potential for property development.

This was creating an investment wave in emerging real estate markets while traditional markets were reaching saturation point, general director of real estate services firm DKRA Viet Nam Pham Lam said.

With the development of transport infrastructure, Lam forecast emerging real estate markets would boom.

Tran Duc Vinh, general director of real estate firm Tran Anh Long An, said the first thing property developers considered was the development or planning for transport infrastructure.

HCM City was working with neighbouring provinces and cities to develop transport projects aimed at promoting regional links, such as the belt road connecting Dong Nai Province’s Nhon Trach District and HCM City and Cat Lai Bridge connecting Nhon Trach and HCM City’s District 2.

The southern city also planned to invest VND96 trillion (US$4 billion) in transport infrastructure this year.

“The opportunities are there for emerging real estate markets when transport connectivity with HCM City improves,” Vinh said, adding that property developers were gearing up to tap these opportunities.

Viet Nam ranks fourth in East Asia in urbanisation growth rate. It was forecast that more than 45 per cent of the country’s population would live in urban areas in 2030 from the current 37.5 per cent.

Nguyen Nhat Cuong from VietinBank Securities Company said rapid urbanisation suggested something for property developers. Instead of focusing on markets like Ha Noi and HCM City, they were moving to neighbouring markets to tap the potential from rapid urbanisation and many projects had seen good sales results.

In Long An Province, developer Hoang Quan is preparing to implement a commercial housing project with 713 units covering 4.9 hectares in Ben Luc District

According to Dong Nai Province People’s Committee, a sum of more than VND33 trillion will be invested in transport infrastructure projects from 2018-20 to ensure connectivity with Long Thanh International Airport. In addition, the province was working on the Bien Hoa – Vung Tau highway and metro line to HCM City.

Distance was no longer a problem for property developers, said Le Hoang Chau, president of the HCM City Real Estate Association. Transport infrastructure would be the catalyst for an investment wave in emerging real estate markets, he added.