6 Reasons Why You Should Invest in Vietnam Property

Many people ask JRE for investment advice in Asia. Not rarely, investors often think about countries like Indonesia or Korea. Sure, Indonesia may have potentials over the long run, but ownership regulations are still not favorable to foreigners. Korea on the other hand, doesn’t grow compared to many countries in Southeast Asia, unless you plan to stay there for personal reasons, it is better to look for somewhere else. 

In this article JRE provides you 6 reasons why you should invest in Vietnam’s Property:

1. New Ownership Regulations since 2015

However, with the new ownership law introduced in 2015, any foreigner with either a 3 month tourist or residence visa may now own property on a renewable 50 year lease. Foreign companies have even greater benefits as they don’t hold any restrictions when buying property.

In addition, there is no limit on the number of units you can buy, as long as the amount of units is within the 30% allowed quota per building (foreigners can only own 30% of the units in one building). 

You can rent out your units, with great yields, and you don’t need to be a resident in Vietnam to own property.

2. Growing Economy

Vietnam’s economy, and especially Ho Chi Minh City’s, is one of the fastest growing in the world, averaging at 6-7%.

As manufacturing becomes more expensive in countries like China, many multinational corporations are turning their eyes towards Vietnam and its cheap labor. 

Not only the top cities, but also ‘smaller’ cities like Bien Hoa will gain from increased manufacturing, and see an increased demand for real estate.

PWC’s Emerging Trends in Real Estate Asia Pacific 2018 survey shows that Ho Chi Minh City is the place to be right now

For those not familiar with the country, let us tell you that there are much infrastructural investment planned, especially in big cities like Ho Chi Minh. 

Things are moving fast in Vietnam, cities like Ho Chi Minh are quickly developing and merging with other cities. There is no doubt that Vietnam will look like a different place entirely in the next 5 years. 

In Ho Chi Minh, districts 2, 7 and 9 are developing quite fast with a plethora of new infrastructural developments lead by the Metro (estimated time of completion is 2020), new museums, shopping malls, schools, hospitals, roads, and a new expo center. You should also pay attention to the Thu Thiem area of Ho Chi Minh, now a big empty lot, it will soon become the new CBD of HCMC. A plethora of residential and commercial projects, led by Keppel Land’s “Empire City”, will soon transformed this area into an iconic place with property expected to increase its value dramatically over the next 5 years. 

Buying property where future infrastructure is planned (along the Metro lines, for example) can result in great yields and capital appreciations.

Vietnam is one of a few countries where the population will increase, from around 95 million to 120 million people until 2040.

Along with a growing middle class, urbanization, and 50% of the population being under 30 years old, there will naturally be a demand for more real estate, especially in the bigger cities like Ho Chi Minh City, Hanoi and Da Nang.

Vietnam is well-known for having some of the best yields in the region, ranging between 6 and 8%. Some developers even guaranteed incomes as high as 8-12% in several growing cities like Hanoi, Ho Chi Minh, and Da Nang. 

A 2 bedroom apartment similar to this one in Ho Chi Minh’s district 2 can be bought for around 150,000 USD and can be rented out for 850 USD/mth. That is equal to a rental yield of 7%.

Just making a comparison, in Singapore investors normally experience yields of below 3%.

In comparison with Thailand, Vietnam’s tourism market is fairly new and not as mature. Having that said, more and more travelers choose Vietnam when going for a vacation.

Vietnam is still comparatively cheap, has great food, golf courses and an astonishing shoreline that’s 300 km long. The tourism increases steadily and beats previous years, time after time. Even Cristiano Ronaldo has decided to buy property in Da Nang, for vacation purposes.

Popular places include: Hoi An, Da Nang, Nha Trang, Ha Long, Phu Quoc, Phan Thiet, and more.