Looking for the next good Vietnam property investment? According to Savills Vietnam, houses and villas in green developments have solid long-term investment prospects with returns being better than securities or bank deposits. Investors do need to be careful when choosing a location, however.
“Limited supply, a strongly growing middle class and good quality products, will ensure this asset class remains sound for the midterm,” Vo Thi Khanh Trang, Head of Research, Savills HCMC, explained in a recent report.
A total of 500 villas and townhouses were sold in Ho Chi Minh City during the first quarter of this year. Many investors are proceeding with caution in the face of economic uncertainty. That being said, some buyers were active as they looked to take advantage of the longer-term opportunities that houses and villas in green developments provide.
Savills Vietnam noted demand in this segment is expected to rise due to population growth and the city’s downward trend in household sizes. Between now and 2023, more than 19,000 houses and villas in green developments are expected to be built in Ho Chi Minh City with many of these located in Eastern districts.
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Hanoi house and villa market declines
The outlook is different in Hanoi. Houses and villas in green developments here may not have the same investment potential. Only 281 sales happened in this segment during the first quarter and quarterly absorption was at its lowest rate in three years. There is some hope for the long term and a government stimulus package could spur investment and support recovery even further.
“The first quarter of 2020 was quiet with supply shortages and low sales. Whilst currently in limbo we expect the sector to pick up quickly as landed properties remain one of the most favored alternate investments,” Matthew Powell, Director, Savills Ha Noi, stated.
Ultimately, those seeking a good Vietnam property investment should consider the total picture when looking at Hanoi houses and villas.
