Vietnam’s real estate market has bottomed out and is showing some encouraging signs of recovery, an expert has said.
Neil MacGregor, managing director of property services firm Savills, said the Vietnamese market would continue to see demand from investors from Japan, Singapore, and South Korea.
Vietnam now offers an attractive destination for investors given that many other Asian markets, now at the top of their cycles, may begin to cool over the next few years, he said.
“We believe Vietnam remains a key destination for real estate investment in the Southeast Asian region,” MacGregor told the Vietnam-Singapore Business Forum in Ho Chi Minh City.
“Our current investment picks include operating hotels and office buildings, as well as niche residential development opportunities,” he said.
The office and residential markets in Ho Chi Minh City are starting to demonstrate a better balance between supply and demand, according to the expert.
While this has yet to result in a significant increase in rental or residential prices, MacGregor expects those increases during the second half of this year and next year.
After long periods of due diligence and negotiations, several successful transactions were announced during the first quarter of this year, Savills said in its Q1 report.
For instance, Korea’s leading retailer, Lotte Mart, acquired Pico Plaza in HCMC as part of its expansion plan. Local developer Novaland Group announced plans in February to invest VND3.7 trillion (US$176.2 million) into three residential projects under construction in the city.