VietNamNet Bridge – A lot of expats in Vietnam have affirmed they will spend millions of dollars to buy houses here, denying the opinion that even if the government opens the real estate market to foreigners as proposed, this would not attract foreigners, who believe that the real estate price in Vietnam is overly high.

Owning houses better than renting

Analysts have noted that the foreigners’ demand for possessing houses in Vietnam has been increasing rapidly.

Philip, a Canadian citizen, who now works as an English teacher for a foreign language center in Hanoi, said he has been living in Vietnam for three years, but he still has not been allowed to buy a house in Vietnam.

Philip now still lives in a 100 square meter apartment in the West Lake area which he leases from a Vietnamese landlord. The rent alone costs him $2,000 a month, or VND40 million.

“The real estate price in Vietnam has become very reasonable. A high end apartment is priced at US$100,000-200,000, or VND2-4 billion,” he said.

“It would be better for me to buy an apartment in Vietnam than living in a rent one,” he added.

Alexander, an US expat in Vietnam, said a lot of his friends complained that they cannot find stable accommodations, though they have been here in Vietnam for 5-6 years. Most of them are the engineers working for the projects which require senior experts.

Alexander himself finds it uncomfortable to live in rent houses in Vietnam. The rents are very high, about VND50-60 million a month for high end apartments, and VND20 million for lower quality ones. The Vietnamese landlords can regularly raise the rents or ask the tenants to leave as soon as they find better clients.

The man said his friends are quite willing to spend millions of dollars to buy apartments in Vietnam, but they still cannot.

Foreign money on the doorstep to the real estate market

A report by the Ministry of Natural Resources and the Environment showed that 427 foreigners had bought houses in Vietnam under the pilot program on allowing foreigners to possess houses by February 1, 2013, including 342 cases in HCM City. The figure proves to be too small if noting that there are 80,000 expats in Vietnam.

Lawyer Bui Quang Hung from the Bui Quang Hung & Associates Law Office, has confirmed that a lot of foreign subjects wants to buy houses in Vietnam. They include the expats who plan to work for long term in Vietnam under the contracts with domestic companies and international groups.

He also said that foreigners want to buy houses not only for their accommodations but for leasing for money as well.

Nguyen Van Minh, Director of the Phat Dat Real Estate Trading Floor, said some his foreign clients are seeking to buy high end apartments, priced at VND8-10 billion.

“They said they would pay in cash as soon as they receive the apartments. However, I told them I could not help, because they were not the ones allowed to possess houses in Vietnam,” Minh said.

The Ministry of Construction, lawyers and real estate firms have been of the same mind about the necessity of setting up a new policy on allowing foreigners to buy houses. Lawyer Hung said that the “open policy” would help attract a strong foreign cash flow to the real estate market, which would serve as a big capital source for Vietnam.

VTC