Hong Kong and Singapore Investors Seek Opportunities in Vietnam

By: Timo Schmidt

Vietnam’s new laws for foreigners, released in July 2015, have already had great impact on the local housing market in the country.

Particularly, investors from within the region are amongst the first ones to actively seek investment opportunities in the country. Savills Vietnam has seen great interest and real demand from foreign buyers based in Singapore and Hong Kong. To better understand the reasons for their aggressive moves it is important to look at the local housing market in these respective countries.

Property markets in Singapore and Hong Kong have been heating up over the last decade due to ever-increasing demand from local and foreign investors. While Singapore is a preferred investment destination for buyers from Malaysia, Indonesia and mainland China, the market in Hong Kong has seen tremendous investment from the latter.

“Property markets in Singapore and Hong Kong have been heating up over the last decade”

To react to the social problems caused by the price increases - such as lack of affordability for first-home buyers - governments in both destinations have put cooling measures in place. These are now showing effect with a considerable drop in transactions, and prices are expected to drop in both countries.

In Singapore and Hong Kong the governments reacted as early as 2009 with a variety of cooling measures, which included:

  • Increase of Buyer’s Stamp Duty (BSD) for purchases of multiple properties of up to 15% in Singapore and 8.5% in Hong Kong respectively, particularly for non-resident foreigners and entities.
  • Seller’s Stamp Duty (SSD) on resale of properties with short holding periods in Singapore for periods of less than one year, which was later increased to three years. And in Hong Kong from two to three years.
  • Limits on loan-to-value for multiple unit purchases, meaning that buyers could not leverage purchases by using bank loans. Especially relative to foreign buyers or those who purchased multiple units.

These measures were specifically introduced to curb property investment and speculation - particularly by foreign investors - rather than preventing irsthome buyers from purchasing units. The effects are finally starting to show with transactions and prices decreasing in both markets, and talks of a property market crises making the rounds. More importantly, the yield potential in these markets has declined due to the additional purchasing costs.

Photo by: Tri Nguyen

Taking into consideration that Hong Kong and Singapore investors are amongst the most active in the region, Vietnam is seen as one of the most attractive destinations for property investment in Southeast Asia. With excellent yield potential and prices at a fraction of those in Hong Kong and Singapore, investors can purchase multiple units at the value of one property in their home markets.

“Vietnam is seen as one of the most attractive destinations for property investment in Southeast Asia”

Savills Vietnam was among the first real estate agencies to take advantage of this by creating an international sales department to actively promote Vietnam’s properties in these key markets; in collaboration with Savills regional offices.

“We have seen great interest of local developers to market their projects abroad, and have scheduled a series of sales events in Hong Kong and Singapore over the year 2016. Our offices in both countries are excited to promote Vietnam’s properties given that the easing of restrictions allows foreign investors to take advantage of low prices and excellent yields in comparison to their local markets,” says the head of International Residential Sales for Savills Vietnam. “Since inception of the department we’ve transacted nearly US$20 million in sales to foreigners without bringing projects abroad. We are confident that this number will increase dramatically over the coming months.”

The opening of the Vietnamese property market to foreign investors is expected to draw more foreign investment into Vietnam from private and institutional investors.


Tall Towers: Saigon’s Race to the Clouds

By: Jesus Lopez Gomez

Saigon’s skyline is defined by a few standout tall towers concentrated in District 1. Peering over Ho Tung Mau street is the city’s third tallest tower, the 40-storey Saigon Times Square. Nearby at the half-moon of road around the Tran Hung Dao warrior statue is the Vietcombank Tower Saigon, the second tallest tower in the city and the seventh tallest tower in the nation.

At 258 metres, Bitexco Financial Tower comes in first. It is about 100 metres taller than third place and about 50 metres taller than Vietcombank Tower Saigon.

Though, all that may soon change.

Even accounting for all the planned towers in Ho Chi Minh City, Bitexco Financial Tower will still remain among the tallest structures in the city, but the incoming Ben Thanh Towers at 235 metres and the 195 metre-high Saigon One Tower are formidable competitors. The city’s iconic lotus-shaped tower will eventually be dethroned for tallest tower by the 461-metre Landmark 81.

Not only will it be the tallest tower in Vietnam, but the tallest in Asia by a petty amount: the development that currently holds that title is Kuala Lumpur’s iconic Petronas Towers, which will be a mere 20 centimetres shorter than Landmark 81.

But when will these towers be finished? What exactly will the skyline look like when it’s done?

Let’s dive deep into Saigon’s towers and gaze into the future.

Ben Thanh Twin Towers

The Ben Thanh Twin Towers project—not to be confused with the Ben Thanh Tower Condo, which has the Air 360 Sky Lounge at the top—will one day be two daring spires designed like a pair of postmodern sculptures overlooking the roundabout in front of Ben Thanh Market.

For now, however, it’s a walled off plot of half-laid foundation and dirt.

Bitexco Group began the Ben Thanh Twin Towers in 2012. They were planned as a 55-storey mixed-use development: the majority of the space would be dedicated to condominiums, but the tower would also be the home of office and retail space.

towersImage source: images.millenin.com

Total investment at the time was about $400 million. The project was expected to be completed in 2015.

The conceptual design seems a little haphazard, but the building’s planners have actually designed it with intentional symbolism.

The project’s two towers symbolise the popular Vietnamese symbol of two dragons. This well-known iconography depicts a pair of entwined dragons circling towards a sun. It’s a common image at pagodas and other prominent cultural locations, like the Hanoi Ceramic Mosaic Mural. The dragon is frequently associated with flight, ascendance and progress.

Similarly, important Vietnamese sites like Ha Long Bay have incorporated the word dragon into their names (the Vietnamese word long means “Dragon” in English).

A popular Vietnamese saying: Rồng gặp mây translates to “Dragon meets the clouds,” meaning something is in a favourable condition.

The project’s two towers will reach 235 metres and 225 metres—touching the clouds, indeed.

When Will It Be Finished?

The project is now expected to be completed in 2020, according to Bitexco Group’s website.

A Bitexco group representative confirmed the new timetable for #iAMHCMC in a phone interview, but wouldn’t go into more details on why the project has been delayed for as long as it has. They noted that builders have nearly finished the basement portion of the Ben Thanh Towers.

Empire City

Also arriving in 2020 is the Empire City project. This 14.5-hectare city-within-a-city development features a shopping mall, an office campus and a 5-Star hotel. The crown jewel of the development is an 88-storey building that will lord over the new development named Empire 88.

towersImage source: lonelyplanetwpnews.imgix.net

For now, the building’s planned height will make it taller than the in-progress skyscraper that’s also vying for the title of tallest tower, Landmark 81. However, the Empire 88 will top out at 333 metres, significantly less than the 461-metre Landmark 81.

It’s not only height that defines this tower, but also a groundbreaking design that brings green elements into the project. And we’re not talking about solar panels or sustainable materials.

The name “Sky Forest” comes from the buildings’ use of actual trees and plants about two-thirds of the way up the Empire 88 building. At this height, the building will have five square-ish platform shaped floors jutting out of the building that will be covered with living plants and trees.

Dubbed the “Sky Forest” by the architecture firm leading the design Büro Ole Scheeren, the international architecture firm unveiled the proposed design last November.

towersImage source: cdn.wallpaper.com

Concept drawings show the Empire 88 tower along with a group of three towers arranged around the terraced public space rich with plants and trees. The architects said they wanted to capture the feel of Sapa’s iconic, terraced rice paddies. The architects have planned a multi-tier, stacked park with graduated platforms. Viewed from above, the space might mirror something like a fingerprint with the platforms’ edges creating continuous lines that wind through the three Empire City towers.

When will it be finished?

The Keppel Land-led project expects to open its first residential properties in the second quarter of 2020.

The 88-storey tower should not be too far behind.

Keppel Land reports that 680 units within the Empire City project have already been sold to prospective residents.

Landmark 81

The Landmark 81 tower had been scheduled to “top out”—the phrase used in skyscraper construction where the highest element has been constructed—in May. But builder Coteccons hit that landmark 45 days ahead of schedule by giving Ho Chi Minh City an architectural asset now taller than the Petronas Towers in Kuala Lumpur. With the 61-metre spire at the top of the building, Landmark 81 stands at 461 metres, about 10 metres taller than the Malaysian towers.

The 81-storey tower is the centrepiece of the Vinhomes Central Park project in Binh Thanh District.

While it remains under construction, developers have been quick to point out that this will not only be the tallest building in Vietnam but the 23rd tallest in the world.

towersImage source: en.vinhomestancang.co

The Vingroup-owned, US$1.5-billion tower is being built with a cinema, indoor skating rink, gym and clubhouse for residents, including a pool, gym, spa and outdoor lounge. Residents will be able to choose from apartments with up to four bedrooms.

The architectural design appears like a cluster of bars consolidated around a tall steeple. The result is a building of staggered heights facing towards the Saigon River. On their website, Atkins, the British architecture firm who designed the project calls it “modern and unusual,” a symbol of the rapid ascendance of Ho Chi Minh City. Retail developments will be the base of the building.

towersImage source: ccr.vn

Even before the building is completed, the development had already amassed awards. Landmark 81 garnered the “best residential high-rise development Asia Pacific” at the Asian Pacific Property Awards 2016. “Atkins is proud to be involved in this award-winning project for Vingroup, as it represents a new benchmark in high-quality, sustainable, high-density, vertical living. This building type will be particularly important as Asia moves forward,” said in remarks reported in a press release created concurrently with the award.

Video source: DC Film

When will it be finished?

The project appears to be on track to finish construction by this year. When completed, it will be only one metre shorter than the Lakhta Center in St. Petersburg, Russia, the 22nd tallest tower in the world. It will be less than 10 metres taller than the 24th placeholder, the Changsha IFS Tower T1 in Changsha, China.

Banner Image source: lonelyplanetwpnews.imgix.net


High-end Hotel Design in Vietnam: The Untold Challenge

By: John Mark Harrell

See how a high-end hotel evolves from concept to creation.

Designing a high-end hotel demands a surprising combination of special skills.

The biggest misconceptions about Interior Design.

Have you ever wondered what goes into making a high-end hotel? You might think it’s as simple as choosing some comfy pillows and shiny golden wallpapers, finding a few art pieces, some colourful and ambiguously-shaped sculptures, throwing it all together and—ta da!—luxury. But you might be shocked to know the true depth and scope of storytelling, conceptualization, and meticulous planning that goes into creating a high-end hotel, far beyond just decorating. Whether or not you realize it, everything you see and interact with as you move through one of these luxury establishments is the result of fine-tuned and precise planning.

High-end hotels need an entire team of creative professionals and experts to oversee this process from conceptualisation to final execution. This is where KAZE, a design studio based in Ho Chi Minh City, consistently delivers. KAZE means “wind” in Japanese, and this ties into their core design philosophy, which is quality in function, design and purpose—yet with a feeling as natural and free-flowing as the wind. This design philosophy is evident in the work they do for their clients all over Vietnam; a rare example of excellence, expertise, and professionalism in Vietnam’s developing market.

KAZE

The team at KAZE has worked extensively with reputable international hotel brands in Vietnam, from Le Meridien to the Renaissance Hotel by Marriott, and the scope of their clientele extends beyond high-end hotels to many commercial and residential developments throughout Vietnam. Such a diversity of projects requires a wide diversity of skills and specialties within the KAZE team itself. To get an insight into exactly what goes into the fascinating process of high-end hotel design, we sat down with Managing Director Khoa, Interior Architect Hanh, and Junior Designer Phat.

From Start to Finish: The Process of Designing a High-End hotel in Vietnam

Luxury is a defining element of any high-end hotel. But what, exactly, do we mean by luxury?

“Before I studied Architecture and began working in a design studio, I thought luxury was all about design and aesthetic” KAZE’s Interior Designer Hanh says. “But now that I’ve worked on an International hotel, defining luxury in a broad sense comes with my ability to translate the branding guideline. To curate an experience for guests through architecture, landscape, art, and culture in a way that is new and original, yet aligns with the hotel’s brand and image.”

“It’s not just about the design, it’s the whole package,” Junior Designer Phat agrees. “The look, the style, and the 5-star service.”

KAZE

You might think of luxury as gaudy, shiny, golden, almost excessive—but these Old Hollywood depictions of luxury are no longer the norm. These days, when you step into a high-end hotel, you’re likely to encounter more modern, minimalist artistic and design elements and cutting-edge technological solutions for the demands of 21st century hotel guests.

“I think nowadays, the definition of high-end is changing,” Khoa adds. “It’s not about material, it’s not about big space or small space. It’s about the experience, and that experience includes the rush of interacting with a new gadget or a cutting-edge technology that you’re being offered as a guest, that you might not have seen before or even knew existed.” 

Think about your own experience at a hotel. If the lobby, restaurant, and public facilities were pristine and luxurious, but your room was drab, dark, and uncomfortable, would you come away from that hotel with a positive impression? 

Of course you wouldn’t! Most of our time as guests is spent in the smallest, most intimate spaces in these hotels, and it is therefore in these relatively small rooms where the design team at KAZE begins their design and storytelling journey with any high-end hotel project. 

“When I work on small spaces like hotel rooms, it’s very complicated because you have to go through every detail in the room,” Phat says. “Because every little detail matters in the big perspective of being a 5-star luxury hotel.”

KAZE

“Space planning is the most challenging,” Hanh says. With a space as limited as a hotel room, every inch of the space must be carefully accounted for and meticulously, precisely planned. “From the brief of clients, to the space from the architecture. It’s the most difficult part.”

According to Phat, it’s actually the initial phase of high-end hotel design that proves the most difficult. “I think the first stage is quite challenging, finding the direction for the project that can run consistently to the very end. It’s crucial that we have a clear story in order to convince the operator to agree to our design.” 

So how does the team at KAZE begin conceptualizing a design story for a new client? They won’t start from scratch, and in fact they’ll have an extensive brief of requirements from their client related to aesthetic, practical needs, and branding that they must take into consideration. 

Could you imagine writing a book for someone who tells you what they think should happen at the end? You would then have to come up with an interesting plot and finer details like setting and character development that meet their expectations. This is the tremendous “design story” challenge KAZE faces with every new high-end hotel client.

KAZE

After hours of planning and brainstorming, an initial schematic emerges from the creative minds at KAZE. But the team can only move on to the next phase if their client says “yes” to the story. 

“[Creating] the schematic takes the longest,” Hanh adds. “Our client may have something specific in mind, and if our story doesn’t align with their vision, we have to go back and change the story...so that eventually it becomes the client’s story. It takes time for us to find each other, making this the costliest and most time-consuming stage of designing.” 

To help their clients visualize the story, the team at KAZE actually uses modern technology to create 3D renderings to bring their concepts to life. 

“There is often a perceived gap between what the client wants and what is actually possible,” Hanh says. “So it’s our job to not only create a story that aligns with the clients’ needs as closely as possible, but to convince the client that our story will result in the very best experience for their guests and for their brand reputation.”

The next phase deals with “kinetic design”—deciding exactly which materials will be used, and how they will be used. This is, in fact, their specialty.

KAZE

“We can use one type of material in many different ways,” says Khoa. “And we spend a lot of time exploring how we can use this material. By pushing beyond what’s normally expected, we find a new interesting way of implementing that material to express the design.”

The process then continues through the practical application of those materials—construction, staging, and final execution, culminating in that magical moment when guests step into the hotel for the first time.

Interior Designers at KAZE: What Skills are Most Important to Develop High-end Hotels?

It takes a team of highly qualified professionals to properly take on any high-end hotel project, and each team member will bring a variety of skills to the table, but which of them is most important? Creativity? Technical skills? A sense of style?

“Different designers have different strengths,” Managing Director Khoa says. “And actually, interior design is a product of the long process of a big team with members who have different skills. One designer might have talent in creativity, but he alone cannot make the project. Other designers are very strong at technical or business management. So the whole team will make the product possible.”

“We can create, but if we don’t have knowledge and experience of the kind of project we’re doing, it’ll turn out very badly,” Hanh points out. “Interior design is never just one person’s job... it’s the team’s whole effort that matters.”

Interior design: It’s more than just decoration

We asked each team member what some of the biggest misconceptions about interior design are.

“That it’s just decoration!” says Hanh. “Even architects think interior design is a way of adding colour and cushions on top of a sofa. But we actually deal with all the details of each material selected and how we can apply it to the detailed millimeter, yet not adding to the cost. Along the way we have to compromise on our ambitions, to adjust to a budget constraints while still delivering what we promised.”

KAZE

“A lot of people think that designers just do creative stuff,” Phat says. “They don’t know the level of structural knowledge, detail work, joinery work and mechanical and electrical stuff we need to know and combine to see our design come true.”

“Most clients don’t know how long it takes,” Khoa adds. “They think it can be done in 1 or 2 weeks.”

“My relatives think I’m just arranging cushions and wallpapers in a room!” Phat chuckles.

Clearly, interior design is a much more involved process that requires a broad diversity of skill sets, brainstorming, teamwork, and specialized responsiveness to the needs of each individual client. “You can’t be lazy in this field,” Hanh says. “If you don’t love what you’re doing, you’ll never manage the long hours and late nights it requires to be an Interior Architect.”

It’s a long and winding road from the start of the journey, when a client gives KAZE their initial brief, to the moment the first hotel guests immerse themselves in that experience curated by the collaborative effort of a creative and diverse design team—but it is that moment that makes those hundreds of hours of hard work, dedication, and passion worthwhile.

Image source: KAZE Interior Design Studio


Quality over Quantity: KAZE Confronts Cheap Construction

By: John Mark Harrell

Foreign and local developers often prioritise profits over future-proofing.

The next generation is pushing for a bright future.

One of the secret “perks” to living in Ho Chi Minh City is that, for most residents, an alarm clock isn’t necessary. Every morning at around 7:00 am, 7 days a week, construction crews diligently start their work, ostensibly eager to do as much possible before the sweltering heat of midday. The shrill shouting of workers and the rumbling of jackhammers drilling into concrete is the near-constant soundtrack of one of Southeast Asia’s most rapidly-developing urban hubs.

In the past decade, HCMC has seen some dramatic new developments radically transform the city’s skyline, from modern urban developments in the Phu My Hung ward of District 7, to the Vinhomes mega-complex and Landmark 81, which is currently Southeast Asia’s tallest skyscraper. Relatively loose zoning restrictions have allowed massive developments, for better or worse, to break ground just about anywhere that space allows in this growing metropolis.

KAZE

Elsewhere in Vietnam, huge new projects in major urban centers and tourist destinations like Nha Trang, Da Nang, Phu Quoc, Ha Long, and Hanoi have expanded rapidly to attract more tourists, provide more housing and office space, and lure foreign investors. Vietnam’s economy is one of the world’s fastest-growing, with steady increases in foreign investment, tourism, and GDP predicted well into the next decade.

Is Growth Outpacing Sustainability?

What does this rapid growth mean, practically, for locals and expats living and working in Vietnam? More foreign investment, as well as foreign development companies breaking ground on new projects in Vietnam, could introduce their expertise with more advanced and modern building techniques, including sustainable materials and future-proof designs, in a relatively young development market.

According to Danish architect Fong-Chan Paw Zeuthen, founder of KAZE Interior Design Studio in Ho Chi Minh City’s District 2, this is most often not the case. 

“Big investment buyers come to Vietnam to invest in a development project and flip them for a 20% yield,” she says. “So the local real estate market is getting watered down with cheap, quick projects that turn a high profit margin regardless of actual build quality.”

This attitude and mindset toward development makes it very difficult for interior design professionals at KAZE to take on new projects with the full extent of their expertise. “Consultants are used more as tools, not valued for their consultancy,” Fong-Chan says.

KAZE

In practice, this means developers most often seek the cheapest and most cost-effective solutions, rather than the smartest solutions that will save them and their end users from trouble further down the road. Interior design firms like KAZE, unfortunately, are often sought out merely to “rubber stamp” the process the developer has already determined in advance. With little to no thought given to environmental concerns and sustainability, this is a growing concern for many professionals who work with local developers.

Part of the problem stems from the young development market in Vietnam interacting with larger development conglomerates investing from afar. “Locals often don’t have lots of experience,” Fong-Chan says. “And [foreign developers] don’t have experience working with locals. Some developers have no idea what they’re doing—they’re first time developers.”

Newer technological advancements and sustainable building practices are eschewed in favour of more old-fashioned techniques that are cheaper and produce faster results. But those results aren’t always pretty; seeing cracks on the walls of brand new buildings in Vietnam is a common phenomenon, largely due to the construction materials, like bricks and mortar, not given enough time to dry out and “settle” before completing the construction process (as they dry, their composition and dimensions change). 

Building materials are most often chosen based on how cheap they are—not whether their production or use is environmentally-friendly. Not only can they be damaging to the environment, however, they can actually be hazardous to human health as well. White asbestos is still widely-used in construction projects throughout Vietnam, and it wasn’t until 2018 that the government unveiled a roadmap to eliminate its use entirely by 2023.

One only has to look to the development of other huge metropolises throughout Asia to see similar patterns from their earlier stages of development. The infamous high-rise apartments in Hong Kong, for example, are exemplary of cheap, quick construction methods with little concern for end users and low-quality materials that degrade quickly overtime and increase long-term costs. 

“In many cases we’re creating really bad living environments,” Fong-Chan says. “We’re not learning from mistakes that the other big cities have made.”

Beyond the developments themselves, these new high-rises often put a strain on local infrastructure. As the city eliminates green spaces due to the influx of traffic brought about by huge new housing developments, unseen problems are just beginning to come to light. In its current state, no water treatment or sewage system can support the number of new high rises being built at such a dizzying rate. For a city already struggling with pollution and increased flooding due to climate change, all these new developments could place even more pressure on an already overloaded system.

Hope for the Future

So what does this mean for the future of Vietnam? It’s a complex problem that developing countries all over the world struggle with as investors respond to market demands. 

“Ultimately, the demand for quality is missing,” Fong-Chan points out. “Developers are not saving the environment or costs for the end user. They’re just looking for a quick turnover.”

Because of inefficient building materials and lack of energy-saving methods, it is most often the end users who are footing a higher monthly bill as a result. If foreign investors are only fixated on short-term returns, many of these new developments will actually cost property owners and business owners more money further down the line.

KAZE

The challenge, therefore, is to increase consumer demand for buildings that are not just fashionable and functional now, but whose design and quality will stand the test of time. As the younger generation becomes more conscious of the environment and their own health, through growing global interconnectedness and education, there remains hope for the future.

Increasingly, we should be asking: should big foreign corporations not take some responsibility for the host country they are building in and making money off of? Shouldn’t we demand that they bring more innovative, advanced, sustainable solutions, instead of just exploiting the environment for a quick profit?

“KAZE is in the industry, questioning the direction we’re going as a community,” Fong-Chan says. “We are always pushing to create new sustainable communities with new developments.“

KAZE

New developments do create new communities that didn’t exist before. It is in these developments that the tremendous opportunity lies to build something that exists in harmony with the environment and promotes human health and happiness—not just for a quick return now, but for the benefit and economic well-being of Vietnam for generations to come.

Image source: KAZE Interior Design Studio


Improving Your Home: An Interior Design Case Study

By: Aleksandr Smechov

Homeowners usually think of their dwelling as a place to relax and unwind after a hard day out, spend a bit of quality family time, and have the occasional meal. But have you ever thought a home can be an extension of one’s personality, a space to feel refreshed after a long day, something that inspires you instead of acting like a permanent hotel?

Interior design’s focus is to enhance an indoor space to make it not only more pleasing on the eyes, but bring its inhabitants together and seamlessly connect separate spaces. Below we take an interior design project in Binh Duong New City, where an existing apartment layout goes through several modifications to maximise both space and function.

1. Existing condition: The existing condition of the space was a three bedroom apartment for a young family. There were long, narrow corridors, too many solid walls that made the public area smaller and tighter for anyone passing through. There were no true spaces for working, reading or entertainment.

2. Solution: As the inhabitants were a young family with a small child (and possibly another coming), changes were made in the layout in order to create a functional space that could fulfill the needs of a small group of closely knit people. For this an “open” concept was used.

2.1 Functional change of space: The project began with the demolition of one bedroom and the creation of a multi-purpose space – this new working/reading room can be used as a guest bedroom when needed.

2.2 Working room: The working room is an open space, connected with other sections of the apartment: the kitchen, the dining area, bedrooms and the living rooms. Privacy for the working room can still be kept using a partition and bookshelf.

2.3 Open kitchen: An open kitchen also helps make the space look bigger, as it connects with other sections of the apartment.

 

2.4 Overview: This “open concept” does not only create a connection between spaces but also connects family member together – while mom is cooking, she can talk or look after her kids, and also speak with her husband in the working room at the same time. All spaces are connected together without boundary, and this creates a roomier feel in the apartment.

3. The value created: A simple change in layout can create a big difference for your apartment, yourself and for others who are engaging in this space.

The above project was completed by OP3 Interior Design & Construction. The firm’s belief is that a home should tell a story about the owner, while at once refreshing those who live there, connecting family together with a seamless space that take into account the natural elements of the earth. You may learn more about their home enhancing projects at op3vietnam.com. For further consultation, you may contact OP3 Vietnam at marketing@op3vietnam.com.


Buying Property in Vietnam

By: City Pass Guide

Vietnam property ownership for expats is a dilemma that has been here as long as the expats themselves. You come to Vietnam, fall in love with the country and settle down. But where will you live? Is it going to be rental property forever? You don’t intend on leaving so why not buy? It may surprise quite a few to realise that it is not as fraught with danger as you may think. It is certainly easier than in Thailand, and there is a lot less chance of you losing your hard earned money.

Vietnam Property Law Changes

The government changed the rules in July 2015, enabling foreigners to buy their dream home here, provided they match a few criteria. Anyone buying property here now has a lease of 50 years, with the ability to sell-on and transfer the lease.

Conic Residental Building in Binh Chanh (Photo by Đức-Huy)

According to the new law, foreigners and foreign entities will only be allowed to buy or take ownership of apartments and houses in commercial projects. They will still not be allowed to buy in areas that limit or ban foreigners. A maximum of 30% of apartments within a given block and 250 houses in a given ward will be available to expats. The 50 year lease will be able to be extended in the future, although details of exactly how this will be done will change over time.

People may think that not being able to buy the land and only the building upon it is unfair, but this is the same for the local population. The government maintains ownership of the land here. Since the announcement, a property market that was already heating up has really opened up and enabled foreigners to join the Vietnam property ladder. The country already had a strong economy and a very strong and vibrant middle class.

These new rules also apply to long term Vietnamese who, living abroad, have kept up their Vietnamese citizenship. With 4.2 million Vietnamese living overseas and about 30,000 high earning foreign executives working and living here (CNBC), the potential for local real estate companies is huge.

Big Changes for Ho Chi Minh City

The drive to modernise the city has meant that developments are springing up everywhere. The new prestigious tower being built in District 1 by Vinhomes is seen as a symbol of the future. At 461 metres, the Landmark 81 tower will be the tallest building in Southeast Asia.

Photo by Vinhomes 

Vietnam’s economy has a steady growth rate of over 5-7% per year. Almost 42,000 apartments were launched in 2015 with a record 36,000 of them being sold (Vietnambreakingnews.com). Vietnam does certainly look like a great place in which to invest. In Ho Chi Minh City, The top end properties are priced at $3,000 to $5,000 per square metre. This is way below the $9,375 per square metre you would have to cough up in Bangkok (Financial Times). And yet, rental yields here are 1.5-2.5% higher than those in Bangkok, Hong Kong and even Singapore, according to VinaCapital.


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