 In addition to projects already underway, Singaporean property company Keppel Land is busy this year drawing up blueprints for a serviced apartment block with 7,500 units in District 2 and a 2,400 apartment complex in District 7, said head representative Linson Lim.
The company also has its sights set on Dong Nai and Vung Tau as potential sites for development. Its decision to invest in Viet Nam stems from the sky high housing demand for people moving into the country to work on the rapidly proliferating foreign investment projects that have arisen from the country’s rapid economic development.
The current market is not suitable for get-rich-quick schemes or speculation. According to Lim, this is the best time for serious commitments to be made in the real estate market.
According to the Cushman and Wakefield Company, the Vietnamese real estate market is still burgeoning and full of potential. That 70 per cent of the local population is under 35 is an advantage for the development of the property market.
"The market is adjusting to the global credit crisis and inflation but we are confident in the market’s long-term potential," said general director of CB Richard Ellis Viet Nam Marc Townsend.
Foreign investment in the first quarter of this year gathered towards the real estate market, according to Deputy Minister of Construction Nguyen Tran Nam.
According to Nam, after rampant speculation, the real estate market has returned to its real value, a sign that official efforts to slow the real estate boom is starting to work.
However, the drop in prices only applies to luxury apartments, which speculators kept buying at inflated prices. Apartments for low and middle income earning people remain overpriced, Nam added.
While foreign investors rush their investments in real estate, local investors find it difficult to raise the capital needed to carry out their projects.
One director of a property trading company noted that most local companies’ funds come from bank loans or are mobilised from other sources. After the Government tightened loans to the real estate sector and increased property taxes and interest rates, many projects came to a standstill due to insufficient funds.
Recently foreign investors have been snatching up local projects left in the midst of construction due to lack of funds or buying land that has just been cleared at low prices.
Chairman of the HCM City Real Estate Association Le Hoang Chau suggested local property companies should work together to find a way to overcome current difficulties.
Source: http://vietnamnews.vnagency.com.vn/ |
