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Expert: Vietnam’s condo market set for bumper 2021

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Apartment prices will remain stable in Hanoi next year while they are forecasted to increase by nine per cent year-on-year in Ho Chi Minh City. PIXABAY

Expert: Vietnam’s condo market set for bumper 2021

Vietnam's condominium market is expected to maintain growth in level of interest and the amount of information about property products available on batdongsan.com.vn into 2021, said the real estate portal’s chief business officer Nguyen Quoc Anh.

Next year, apartment prices will remain stable in Hanoi while they are forecasted to increase by nine per cent year-on-year in Ho Chi Minh City, he said.

He said the level of interest in private houses and townhouses is set to decrease, driving down rental prices, while the asking price for private homes in Hanoi is forecasted to grow by five per cent next year.

Investors are most interested in landed property, but due to the Covid-19 pandemic, interest has decreased, he said.

He said infrastructure projects that started this year are expected to increase the level of interest in this segment in the near future.

Of these, he said the level of interest in information about property in Thuy Nguyen district, Hai Phong city and Bao Loc city, Lam Dong province surged last month after the approval of a project establishing Thuy Nguyen city and a project building the Tan Phu-Bao Loc expressway, respectively.

For industrial real estate, he said it was a bright spot this year and that would continue into 2021 due to free trade agreements and plans to relocate production plants to Vietnam from many foreign corporations.

Anh told the Vietnam Real Estate Conference held by batdongsan.com.vn on December 8 in Hanoi: “This is a chance for Vietnam, but whether Vietnam can take the chance or not is another story.

“The development of this property segment does not stop at the construction of industrial parks for foreigners to rent. It must have a comprehensive development strategy for this segment.”

In the first six months of this year, only one industrial park was established, showing that while there is much talk about the potential of industrial real estate, little gets done in reality, he said.

In the third quarter of this year, industrial real estate showed impressive growth in searching for information about industrial zones.

In the third quarter, the country had 369 industrial zones to be established, up 33 industrial parks compared to the second quarter and 280 industrial parks were put into operation, an increase of 19 industrial parks compared to the second quarter.

This year saw the start of 10 new major transport projects nationwide, including five in the central region.

“Along with moving investment to Vietnam, these large transport projects will have a strong impact on the domestic real estate market. Therefore, the market will have positive changes in 2021,” Anh said.

In addition, with a lot of positive information about the Covid-19 vaccine, the resort property segment is also expected to recover next year, he said.

At the seminar, Nguyen Hong Van, the market director for real estate services firm Jones Lang LaSalle Vietnam Co Ltd (JLL Vietnam), said the price and occupancy rate of industrial real estate in the country will continue to increase in the next few years.

The two sectors leading industrial zone investment by number of companies are electronic components and logistics, she said.

According to her, the region with the most opportunities for real estate development in industrial zones is in the north, especially Hai Phong city, due to large land area, competitive price, convenient transportation and synchronous development of infrastructure.

“So, along with traditional industrial real estate, the demand for modern logistics will also be an opportunity to help the northern industrial real estate market thrive in the near future,” Van said.

However, she said it would face a number of challenges such as hot development leading to a shortage of labour, limited infrastructure conditions such as energy, wastewater treatment and support services for the development of manufacturing logistics, and housing.

Industrial zone investments are long-term, at 30-50 years and not just three-to-four years, she said, cautioning investors to carefully assess their personal financial situation before making an investment decision.

If they are unable to make the investment, they can put their capital into the construction of houses or satellite urban areas around industrial zones for workers to buy or rent, she said.

VIET NAM NEWS/ASIA NEWS NETWORK

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