Savills: Vietnam a global property hotspot

Savills Hanoi director tells conference of how Vietnam's real estate sector is the equal of most others.

Savills: Vietnam a global property hotspot

Vietnam is one of the global property hotspots in 2019, Mr. Matthew Powell, Director of Savills Hanoi, told a conference in the capital on May 15.

“With robust fundamentals, a positive macroeconomic outlook, and continuous investment into infrastructure, the real estate market is thriving across a multitude of sectors,” he said. “Strong potential is creating strong investment demand in all property markets.”

According to the Savills Impacts 2018 report, at the end of 2017, the value of the world’s real estate reached $280.6 trillion, of which approximately 78 per cent is comprised of residential property.

To give this figure context, the total value of all the gold ever mined is approximately $7.6 trillion, and global GDP is $78.3 trillion, representing 30 per cent of the value of global real estate. Real estate is by far the most significant store of wealth and stands at more than 3.5-times total global GDP.

“Equities and gold grew much faster in value than real estate, but rising wealth in emerging economies means there is more capital at large, and real estate is viewed as a safe store for it,” Mr. Powell went on.

“Investor motives remain a mixture of wealth storage, capital appreciation, and income return. But, increasingly, the income produced by real estate assets and the potential for rental growth has become of greater interest to investors, as yields on fixed-income assets have compressed.”

There will be strength in Vietnam’s residential market, he said, supported by the rapidly growing middle class, strong urbanization, and some of the best rental yields anywhere in the region.

Meanwhile, the office markets in Hanoi and Ho Chi Minh City continue to be among the most exciting property sectors in the region. “We expect to see strong investor demand in the office sector as it continues to mature,” he told the gathering.

Hospitality markets are benefiting from growing numbers of both domestic and international tourists, as well as growing numbers of direct international flights.

 

It’s no surprise, he said, that hotel investors are descending upon Vietnam as the next regional hotspot.

Industrial real estate, fueled by growing FDI being poured into manufacturing, improved infrastructure, and a competitive outlook when compared with other countries in the region, represents one of the most active sectors for M&A activity in 2019.

“There is massive interest from foreign investors at the moment,” Mr. Powell added.

For foreign investors, despite strong interest, what gets in the way of turning it into investment transactions and efficient use of capital is the risks.

It’s also important that they are able to make clear comparisons between Vietnam and other countries such as Indonesia or more developed markets like Singapore and Hong Kong (China). To make this comparison, transparent information is essential and becomes a key part of the decision-making process.

Local investors are taking heat from international players with large capital flows and from new property concepts entering the market.

New policies and amendments coming into effect are also creating challenges for developers in financing, constructing, and recovering capital. Global trends such as prop-tech are shaking up the real estate market for all investors, but local developers are certainly less experienced in adapting to such disruptors.

Mr. Powell concluded that the outlook for Vietnam is positive. “There is continued and growing investment interest in the property market, shown in growing FDI levels, increasing numbers of M&As, and a surge of new business registrations,” he said.

“The real estate market, which is linked directly to the performance of the macroeconomy, will continue to be influenced by various policies, including monetary, business, and planning, as well as housing regulations.”

VN Economic Times

 
 

Other News

.
Banks push bancassurance amid low credit growth
Banks push bancassurance amid low credit growth
BUSINESSicon  09/10/2020 

Banks are pushing the sale of life insurance products (bancassurance) in the context of low credit growth since the beginning of this year due to the impacts of the COVID-19 pandemic.

Sound direction for Vietnam’s chances of economic revival
Sound direction for Vietnam’s chances of economic revival
BUSINESSicon  09/10/2020 

Despite heavy aftermaths caused by the global health crisis, the Vietnamese economy remains in positive growth in the first nine months of the year on the back of the government’s sound responses to curb the pandemic return.

Mystery businessmen pours VND150 billion into ITA, Dang Thi Hoang Yen makes surprise move
Mystery businessmen pours VND150 billion into ITA, Dang Thi Hoang Yen makes surprise move
BUSINESSicon  09/10/2020 

The ITA shares of the Tan Tao Group unexpectedly witnessed an impressive trading session with a record high trading volume.

VN rice exporters gear up to penetrate EU arena
VN rice exporters gear up to penetrate EU arena
BUSINESSicon  08/10/2020 

Vietnamese companies have been stepping up investment to boost rice exports to Europe – however, it remains a challenging task penetrate the market efficiently.

VRDF highlights advantages of value chain development
VRDF highlights advantages of value chain development
BUSINESSicon  08/10/2020 

Amid the heavy impact the pandemic has had so far on Vietnam’s economy, possible solutions to overcome the crisis and come out even stronger have been under discussion at this year’s Vietnam Reform and Development Forum.

Plastic stocks surge in two months, boosted by low production cost
Plastic stocks surge in two months, boosted by low production cost
BUSINESSicon  08/10/2020 

Listed plastic companies have seen their market values expand 15-50 percent in the last two months on low oil prices and increased consumption.

Husbandry to undergo modernisation
Husbandry to undergo modernisation
BUSINESSicon  08/10/2020 

New technologies from the fourth Industrial Revolution will be applied in livestock breeding in order to produce safe and high-quality output while improving the husbandry sector’s competitive edge,

Businessman leaves after 16 years of building fortune
Businessman leaves after 16 years of building fortune
BUSINESSicon  08/10/2020 

The long battle inside the biggest construction company in Vietnam has come to an end with the departure of a successful businessman.

VN issues action plan to implement National Energy Development Strategy
VN issues action plan to implement National Energy Development Strategy
BUSINESSicon  08/10/2020 

Vietnam aims to raise its renewable energy sources to 15-20 per cent of the total energy supply by 2030 and 25-30 cent by 2045.

Trade surplus reaches $7.2 billion
Trade surplus reaches $7.2 billion
BUSINESSicon  07/10/2020 

Vietnam’s total import-export turnover for agricultural, forestry and fishery products in January-September was estimated at nearly US$52.8 billion, making for a trade surplus of $7.2 billion,

Additional economic relief packages in the pipeline
Additional economic relief packages in the pipeline
FEATUREicon  07/10/2020 

The Government is drafting second economic relief packages aimed at assisting the national economy, especially businesses, in the face of the ongoing COVID-19 crisis.

Local manufacturing industry enjoys solid growth in September
Local manufacturing industry enjoys solid growth in September
BUSINESSicon  07/10/2020 

Manufacturing sector returned to growth in September as concerns around the outbreak of the COVID-19 pandemic in the country eased. Both output and new orders increased, while business confidence strengthened, and the rate of job cuts softened.

Agriculture: Backbone of Vietnam’s economy
Agriculture: Backbone of Vietnam’s economy
BUSINESSicon  07/10/2020 

Agriculture has long been the backbone of Vietnam’s economy and has posted a range of achievements in the 30 years since the country’s economic reform (Doi Moi) process got underway.

Negotiations on Vietnam-UK FTA expected to be completed late this year
Negotiations on Vietnam-UK FTA expected to be completed late this year
BUSINESSicon  07/10/2020 

Vietnam and the United Kingdom are speeding up negotiations on a new-generation free trade agreement between the two sides, which is expected to be completed at the end of this year.

Billions of dollars worth of shares expected to enter bourse
Billions of dollars worth of shares expected to enter bourse
BUSINESSicon  07/10/2020 

A number of commercial banks are going to list their shares at the HCM City Stock Exchange (HOSE), and are expected to bring a breath of fresh air to the market, which has been stagnant because of the pandemic.

Dirt-cheap so-called ‘branded’ cosmetics fooling people on Facebook
Dirt-cheap so-called ‘branded’ cosmetics fooling people on Facebook
BUSINESSicon  07/10/2020 

Skincare and make-up products, introduced on livestreams as branded goods, priced at just several thousand or tens of thousand dong, have trapped many people.

‘Branded goods King’ sells pho, earns VND1 billion a day
‘Branded goods King’ sells pho, earns VND1 billion a day
BUSINESSicon  08/10/2020 

Billionaire Johnathan Hanh Nguyen, Duc Long Gia Lai and Diem Thong Nhat were top names in the news last week.

After peaking in 2019, startup investment slows down in first half of 2020
After peaking in 2019, startup investment slows down in first half of 2020
BUSINESSicon  06/10/2020 

Investment in Vietnamese startups reached a record high in 2019 but dropped 22 per cent in the first half of 2020 due to COVID-19, according to the Vietnam Tech Investment Report 2019 for the first half of 2020 by Do Ventures.

VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 8
VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 8
BUSINESSicon  08/10/2020 

HCM City businesses resume operation as pandemic eases: city official

VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 7
VIETNAM'S BUSINESS NEWS HEADLINES OCTOBER 7
BUSINESSicon  07/10/2020 

Processing-manufacturing companies optimistic about Q4 business outlook

 
 
 
Leave your comment on an article

OR QUICK LOGIN