HCMC property market attracts investors

Over the past several years, the real estate market in Ho Chi Minh City has better satisfied the need, while contributing significantly to infrastructure development. The city’s per-capita housing area has increased considerably from 10.3sq.m in 2006 to 17.32sq.m in 2015 and 17,8sq.m at present. The figure is expected to reach 19.8sq.m by 2020. 

                    The real estate market in Ho Chi Minh City has attracted foreign investors

Attracting foreign investors

A diverse range of real estate projects have been constructed and put into use in Ho Chi Minh City. They contributed to meeting the need and improving the city’s face.

The total balance of outstanding loans for the real estate sector has so far hit VND420 trillion, up by VND100 trillion from last year. Ho Chi Minh City currently ranks first among provinces and cities nationwide in terms of capital and the number of transactions.

Apart from domestic investors, the city has attracted a lot of foreign investors. In the third quarter of 2016, a joint venture between Maeda from Japan and the Thien Duc Company was launched to implement a luxury apartment project - the Waterina - in District 2. This is Maeda’s first high-end apartment project in Vietnam.

Mitsubishi signed a joint venture contract with Bitexco to develop a housing project with an initial capital of US$290 million. The 176-year-old Kajima Group from Japan has recently entered a US$1-billion joint venture (ICC-Kajima) with Indochina Capital.

Besides, big names such as Lotte and Mapletree announced to intensively invest in real estate projects in eastern Ho Chi Minh City.

Development opportunities

In the 2016-2020 period, the demand for investment in the city’s infrastructure, including real estate, will be huge. The city planned to invest billion, including official development assistance (ODA) capital, state budget and commercial loans, plus US$2 billion in the form of public-private partnership (PPP) investment.

Along with providing favorable conditions for application of existing policies, the city will focus on administrative reform in investment, land management, planning and construction to create a transparent and open business environment and attract investment from more economic sectors in the real estate market.

Apart from development of central urban areas, Ho Chi Minh City will promote projects in the eastern, southern and northwestern city, including Thu Thiem, Can Gio, Nam Saigon, Phu My Hung, Tay Bac Cu Chi and Binh Quoi Thanh Da, among others. The city will also resettle 20,000 households living along canals, reconstruct half of apartment buildings built before 1975. This is an opportunity for real estate investors.

Ngoc Thao / ven