Current perspectives on the real estate markets and economy in Vietnam in 2023 and 2024 as recently viewed by real estate experts in Vietnam.

Dr.Sopon Pornchokchai, President, Agency for Real Estate Affairs was invited by the Vietnam Real Estate Brokers Association to its annual gala dinner in Hanoi on June 24, 2023. He conducted a survey of participants at that event who are experts in real estate, mostly real estate brokers and consultants. The number of respondents was 32 from 350 participants. This percentage was not high; however, it does reflect some insights. Interesting findings were as follows:

Table 1: Rating Economy and Real Estate Markets

                                                              2023          2024

Economy of Vietnam                                  5.9             7.6

Real Estate Markets                                   5.2             7.0

Experts saw that currently the economy of 5.9 out of 10. This implied that it was moderate. However, they believed in 2024 the economy would be recovered to be 7.6 out of 10. In terms of real estate markets, they were rated lower than the economy, i.e. 5.2 out of 10. Likewise, real estate markets could be recovered in 2024.  At present, there is some oversupply. There is not much speculative buying of condominiums due to rigorous corruption suppression campaigns by the government. Property buyers may be required to declare the original sources of money.

Table 2: Growth Sectors of Real Estate in 2023

Sectors                                          Percentage

Industrial properties                               23%

Resort properties                                   18%

Affordable housing                                 16%

Land subdivision                                    11%

Condominium for sale                             7%

Agricultural properties                             5%

Commercial properties                            5%

Others                                                  16%

Total                                                    100%

It was found that industrial properties were the first in priority. As we know industrial developments are growing in Vietnam. Vietnam attracts a lot of foreign direct investment. In addition, many factories moved from Thailand to Vietnam. Resort developments were the second in priority. Vietnam has many resort cities along the coastal line of the country. The third in the priority was affordable housing, particularly for lower-middle income group.

Considering major players in real estate developments in Vietnam, majar developers were Central Group (Thailand), Khang Điền Group, Masterise Homes, Nam Long, Novaland, Sun group, Taseco Land, Thắng Lợi Group and Vinhomes.  Since there were only 32 respondents, no ranking of the developers was conducted with statistical confidence.  However, the above were the prominent names in the markets.

Table 3: Cities with the Largest Amount of Real Estate Developments

Cities                                             Percentage

HCMC                                                   21%

Hà Nội                                                  19%

Đà Nẵng                                               14%

Nha Trang                                              7%

Hai Phong                                              6%

Khánh Hoà                                             5%

Quảng Ninh                                            5%

Đà Lạt                                                   4%

Phú Quốc                                               4%

Vũng Tàu                                               4%

Bình dương                                            2%

Kiên Giang                                             2%

Ninh Thuận                                            2%

Phan Thiết                                             2%

Phú Yên                                                 2%

Total                                                    100%

HCMC, Hanoi and Danang were among three largest cities. HCMC was considered an economic stronghold; whereas, Hanoi is the administrative centre like Shanghai and Beijing of China. Danang was both an industrial and recreational centre. There are many industrial developments there. Danang was also the centre to travel to other resort destinations located nearby.

Table 4: Target Countries to Buy Properties Abroad

Country                                       Percentage

USA                                                      21%

Australia                                                17%

Singapore                                              12%

Canada                                                  10%

France                                                   10%

United Kingdom                                       8%

Netherlands                                             7%

Thailand                                                  6%

Lao                                                         2%

Malaysia                                                  2%

Malta                                                      2%

South Korea                                            2%

Total                                                     100%

Amazingly, USA is the number one country where Vietnamese want to buy a house or property (21%). The second in the priority was Australia (17%). Historically, there were many Vietnamese refugees settling in both the USA and Australia. The third in the priority was Singapore. Actually, Vietnamese also had relatives in Canada and France (both 10%). There were those expecting to buy a house in Thailand as well (6%).

In sum, Vietnam is still considered a country of growth with high hope because of industrial and tourism developments.  The current situation of slow growth is expected to be temporary.