Real estate market evaluated potential

17:25 | 14/08/2014

VGP – Surveys have shown that the real estate market of Viet Nam is potential despite its small scale.

According to Nomura Research Institute’s survey results, the country’s real estate market is about US$21 billion while those of Japan, Singapore, Indonesia, Thailand, Malaysia and the Philippines are US$2,678 billion, US$241 billion, US$189 billion, US$89 billion, US$84 billion and US$48 billion, respectively.

It is said that about 70% of investment in real estate transactions is from bank loans and the remaining capital is mobilized from residents, official development assistance, foreign direct investment (FDI) and foreign indirect investment (FII). However, the FDI flow to real estate has fallen sharply and tends to recover.

According to the Agency of Foreign Investment, under the Ministry of Planning and Investment, FDI registration in real estate in the first seven months of the year reached US$1.13 billion, a 65% year-on-year rise.

Though house prices in Viet Nam are still higher than the income-per-capita, Sigrid Zialcita, Managing Director of Cushman & WakefieldResearch Services for the Asia Pacific region, said that she saw a developing trend in the country’s house trade.

She said that her company has conducted a study on the major spending group of middle-class families in the region and found that the number of middle-class families in Viet Nam has been doubled for the past five years. This is believed to stimulate house trade turnover.

Viet Nam has a rapidly developing economy, which will attract multinational companies, local and international groups, as well as their staff to come to live and work in the country. This will help office market develop and fill up office buildings, Zialcita added.

                                                                                                                                        By Vien Nhu