VietNamNet Bridge - While foreign capital is flowing to real estate in Vietnam, domestic capital is going to the international property market.

In October 2015, an Australian firm held a meeting in HCM City to show its gratitude to Vietnamese clients who bought houses in Australia in 2015.

During this meeting, Ms. Tran Thai Nhu, Director of a pharmaceutical company in District 5, Ho Chi Minh City, told participants why she had decided to pay more than VND10 billion ($5 million) for a villa in Australia.

Nhu said in early 2015, with over VND10 billion in hand, she looked for a villa in District 7. However, the seller asked for over VND20 billion for the villa she wanted.To buy this villa, Nhu will have to borrow from bank, at high interest rate while the local real estate market is unstable.

Through the introduction of a friend, she decided to buy a villa in Australia for the following reasons: The real estate market there is always stable; the prices increase regularly; the procedures are easy; and the local banks are willing to supports foreigners to buy houses with up to 60% of the value of the house through guarantees from the consulting firm and lawyers.

According to the assessment of a UK-based real estate consulting firm, which has an office in Ho Chi Minh City, the need for purchasing houses abroad for Vietnamese people has increased in recent years, concentrating in the US, Australia, and Canada. The prices there are relatively suitable with the financial capacity of some Vietnamese.

Ms. Nguyen Le Van, business development manager in Asia - Pacific of Iwealthpor Property Consultants Company, said that in Vietnam there are about three to four companies acting as the span between Vietnamese buyers and estate project owners in Australia.

There are also many other companies specializing in the markets of Canada, USA, and Singapore, Van said.

Mr. Tran Van Tuan, counselor of the British Migration Consulting Company, said the UK offers big incentives to attract foreign investors into real estate. Accordingly, if foreigners purchase the house priced at a million pounds or more, they will be granted a permanent visa to the UK.

Foreign customers who buy houses from 2 million pounds or more and do not sell the house after four years will be considered for British citizenship.

"In the past two years, my company has supplied consulting services for more than 200 Vietnamese to own houses in Britain," Tuan said.

In Singapore, a report from Savills shows that foreigners own one third of the real estate market, including many Vietnamese.

An official of the HCM City Real Estate Association said that Vietnamese purchasing houses abroad is illegal because Vietnam law is tightening the outflow of foreign currency from Vietnam to foreign markets.

Le Hoang Chau, Chairman of the HCM City Real Estate Association, confirmed that only two companies in HCM City are licenced to conduct real estate transactions abroad: the Thu Duc Housing Development Company (TDH) with the office in the US and Hoang Anh Gia Lai Company. Other companies are operating illegally.

Mr. Ngo Quang Phuc, deputy general director of Him Lam Land, said that investing in foreign real estate markets is not as beneficial as investing in the home market. "With interest rates abroad only 0 to 1%, then the investment will yield little profit," Phuc said.

Dau Tu