Real estate growth anticipated next year

Nguyen Quoc Anh, deputy general director of PropertyGuru Vietnam, noted a sharp increase in interest in real estate heading into next year as market confidence and investor sentiment improve.

Real estate growth anticipated next year

“In each stage of development, the real estate market has different characteristics, based on fluctuating cycles. From now until the end of the first quarter of 2025, the market will continue to be in a consolidation phase. Buyers will still focus on real housing needs, and the most chosen products will be private houses and town houses,” he said.

From then until the year-end, he added, the real estate market will enter a period of prosperity, led by segments that bring high profit rates such as land plots and project villas. In 2026, the market could enter a stable cycle, with prices and liquidity increasing in a variety of types, Quoc Anh added.

Marc Townsend, senior advisor at Arcadia Consulting, expressed that Vietnam’s continued economic growth depends on exploring diverse and resilient growth strategies.

“Vietnam’s real estate market must be prepared to adapt as it undergoes significant restructuring,” Townsend said. “Adaptable businesses can thrive by incorporating regional and global trends into their strategies. However, current challenges – such as delays in project approvals and rising financing costs – mean that a swift, automatic recovery is unlikely this time.”

Lucas Loh, CEO of Nam Long Group, emphasised that real estate was closely tied to economic development. “Beyond residential demand, real estate encompasses a wide range of sectors, including shopping malls, retail centres, offices, industrial facilities, warehouses, data centres, and hospitality,” Loh said at the VinaCapital Investment Conference in October.

Loh highlighted how infrastructure improvements under the new land law will boost land supply and connectivity. By facilitating the development of bridges, roads, and railways, the new law will allow cities to grow and expand economic distances. This will inevitably drive growth in the real estate sector, Loh added.

“Going forward, there will be an increased supply of land by the fact that there will be enhanced infrastructure built by the new land law that allows the government to acquire land easier to build bridges, roads, and even railway,” Loh said.

In Ho Chi Minh City, many people are moving to live in surrounding areas and coming into the city’s centre to work. This is ideal if there is a good infrastructure system.

“In fact, it naturally increases the supply of accessible land for people. Ho Chi Minh City can become a megacity where people living in neighbouring provinces go to the centre for work. This will increase the supply of land to meet demand. Over time, with infrastructure development, supply will increase, and the new land law certainly helps the government develop this,” Loh explained.

Meanwhile, Angus Liew, chairman of Gamuda Land Vietnam, said that infrastructure upgrading was pushing up the demand for housing.

“The past two years the business has been good for Gamuda Land. We launched the Eaton Park project in Ho Chi Minh City in May, which was 95 per cent taken up during the launch day. The group has also received positive sale of another project in Binh Chanh district, with 90 per cent of absorption rate in three months,” Liew said.

According to Michael Kokalari, chief economist of VinaCapital, the demand for new housing units far outstrips supply, with that demand driven by young couples and urbanisation.

“Consequently, sales of new housing products are very brisk, although securing approvals for new projects remains difficult,” Kokalari said.

He added that while new real estate regulations would make the approvals process more transparent, they were also likely to have a negative impact on smaller developers, which in-turn could prompt some consolidation in the sector going forward.

“Critically, the approvals process for new projects is getting quicker, and should support banks’ 2025 earnings prospects. In short, the nascent real estate sector recovery is expected to be a key driver for loan demand and earnings growth next year,” he said.

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