The recent amendments to Vietnam's Land Law, set to be enforced from January 1, 2025, promise substantial opportunities for overseas Vietnamese (Viet Kieu) to invest in real estate. These changes include expanded land-use rights for Viet Kieu, fostering increased engagement in the property market. Analysts predict heightened transparency under the new laws which are likely to attract greater foreign direct investment (FDI) into the real estate sector. The government anticipates a positive impact on Vietnam's economy and further integration of Viet Kieu into the nation's development trajectory, signaling a promising outlook for both investors and the real estate industry.
Following the relaxation of policies regarding foreign home ownership, CBRE reports that clients from Asia, including China, Hong Kong (China), South Korea, and Taiwan (China), have emerged as the primary investors in Vietnam's housing market.
These Asian clients are drawn to Vietnam due to its proximity and the presence of real estate firms from their respective countries.
The primary motivation for most foreign buyers is the anticipation of price appreciation. However, the number of foreigners purchasing apartments for personal residency remains minimal.
CBRE notes that foreigners favor high-end apartments in Ho Chi Minh City and Hanoi, particularly targeting projects situated in strategic locations with reasonable prices and promising potential.
The report was compiled using two decades of urban development data from the Ministry of Construction (MOC). The data revealed that from 2015 to the third quarter of 2023, more than 3,000 foreigners invested in property in the country. Out of every ten foreign investors, nine preferred purchasing residential apartments, with 60 percent intending to sell them later as prices rise. Notably, 75 percent of buyers hailed from developed Asian nations.
Analysts suggest that the recently introduced policies will offer significant investment opportunities for Viet Kieu, referring to overseas Vietnamese, in the real estate sector. The upcoming Land Law of 2024, slated to come into force on January 1, 2025, encompasses numerous revisions, notably extending land-use rights for Viet Kieu. Furthermore, experts anticipate that the enhanced transparency resulting from the new legislation will attract greater foreign direct investment (FDI) into the real estate industry.
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