The strength of the economy is a direct result of property activity.
As the year draws to a close it can be said that Vietnam’s economy has been particularly prosperous over 2016. Welcoming a number of new businesses by a staggering 93 percent compared to the previous year, plus an impressive rise by 213 percent of registered capital.
Real estate has played a huge part in these figures. The Ministry of Planning and Investment has reported that this sector accounts for a vast majority of the newly registered businesses and for investment capital for the first 10 months of 2016. Lured by the profits on offer, investors have been keen to get onboard in this growing industry.
Secretary general Tran Ngoc Quang of the Vietnam Real Estate Association has said, “I have to say that profits from real estate investment is relatively high… Investors, after surveying the market, assume that the profit in the field is no less than 20 percent. This is why they injected money into the market”.The
However Quang is keen to point out that profits are more attractive to developers who execute their work in a professional manner. This is turn produces better results and satisfied customers, which will only go to boast the already buoyant market such as that of Ho Chi Minh City.
To support this positive outlook real estate firm CBRE has reported that there has been a 17 percent increase in transactions in October. In Hanoi there were 1,300 transaction alone, up by 18.2 percent from September, with a particular focus on Cau Giay, Bac Tu Liem and Nam Tu Liem thanks to newly completed projects that were launched. 1,225 transactions occurred in Ho Chi Minh City. This is an increase of 16.7 percent thanks to supply being ramped up in Binh Thanh, Districts 2 and 7 of the city.
Since Vietnam has relaxed its restrictions on overseas investors coming into the country, the property market has responded well. The expectation is for this to continue into 2017 as more investors are drawn in and developers respond accordingly.