Viet Nam’s real estate market, as a whole, is expected to resume its bustling vibe over the rest of this year, and that of Da Nang is no exception, hopefully. Director of Savills Ha Noi Matthew Powell has projected that the real estate market in 2021 still has potential for development. Viet Nam has more real estate investment opportunities than other more mature Asia-Pacific markets, although certain difficulties remain.

More domestic developers have nimbly pivoted to the burgeoning industrial and logistics sector. Here is a corner of Phu My An urban area, Hoa Hai Ward, Ngu Hanh Son District, Da Nang.

Accordingly, there are three groups of potential customers are individual investors, foreign and domestic developers.

Real estate investors from more mature Asia-Pacific markets with more limited Real Estate growth potential such as Japan and South Korea, see extensive opportunities in Viet Nam. Increasing numbers of Japanese and Korean investors are looking to the Vietnamese market, assessing land options at the right price.

Some domestic developers focus mainly on residential real estate, while other more specialist investors have nimbly pivoted to the burgeoning industrial and logistics sector from apartment or resort development.

The COVID-19 pandemic is changing the shopping habits of Vietnamese consumers, many of whom are moving online, and this is leading to an increase in requirements for supporting infrastructure, cold storage, warehousing, and logistics. The industrial and logistics sector, therefore, is expected to become key investment segment this year.

For individual investors, real estate remains a favourite investment channel for its mid-term capital growth potential. Accordingly, they show their interest in longer-term investment opportunities in the Branded Residence model which features apartments or villas developed and operated by better known Hospitality brands, including international hotels.

Based on the aforementioned projections by Savills, there is no denying that Viet Nam’s real estate is focusing exclusively on one group- ‘a niche market’ - or demographic of potential customers who would most benefit from the offerings.

Real estate prices in 2021 are expected to increase by 10 per cent over the previous year, said the Viet Nam Real Estate Association (VNREA). 2021 will not have a risk of a virtual crisis or a bubble, but develop sustainably.

Infrastructure projects with good business opportunities will become attractive forces. Some Vietnamese ocalities whose real estate has been stagnant over recent times such as Da Nang, Quang Nam, Khanh Hoa and Phu Quoc will be bustling again.

With regard to Da Nang real estate market, Nguyen Tam Tien, General Director of the Trungnam Group, the developer of the Da Nang IT Park project, confidently said that 2021 will see this business harvest more success. Trung Nam Land, one of the Trungnam Group’s members, has made remarkable movements in business activities.

Till date, the Lien Chieu District-located, Trung Nam Land- developed Da Nang Information Technology Park (DITP) Tower, with a total internal gross floor area of 18,857m² was leased out by foreign partners.

Besides, Trung Nam Land is developing a number of office buildings targeting IT businesses. 

Also notably, Trungnam Group is racing against time to complete the construction of four apartment blocks of between 10 and 21 and 97 villas with a total investment of 2,100 billion VND in a bid to develop housing exclusively for experts working for the Da Nang IT Park.

In a similarly active vein, Da Nang-headquartered Dat Xanh Mien Trung JSC- one of the best profitable real estate businesses in Viet Nam, plans to pour a combined total of 10,000 billion VND into real estate projects in Da Nang and some other Vietnamese localities this year, said Mr Tran Ngoc Thai, Chairman of the Board of Directors of member companies, Director of Investment and Land Fund Development.

Particularly, in Da Nang, in the first half of this year, the company will start the construction of 100 shop-houses at the Regal Pavilon project in Hoa Cuong Nam Ward, Hai Chau District, and the two-blocked Marie One Complex luxury apartment project in Ngu Hanh Son District-based Phu My An new urban area with a combined total of 683 apartments.

In the second half of this year, Dat Xanh Mien Trung will continue to complete the construction of Lien Chieu District- located Dragon Smart City project.

Such aforementioned large-scale projects demonstrate the company’s efforts to chase this year’s target on its ambitious journey of continuously spreading its brand and superior business capabilities across the domestic real estate market.

Explaining why Dat Xanh Mien Trung decides to channel such a large amount of capital into its projects during this year, Mr Thai said that Central Viet Nam’s real estate market would rebound and grow.

As for advantageous external factors, real estate in Central Viet Nam is proving to be the top investment choice. The bank savings interest rate has fallen to the bottom as compared with many recent years, whilst the lending interest rate is very preferential making loans more accessible and attractive to real estate investors.

Also, 2020 marked itself as a thriving year for the stock market, thus bringing significant revenue to many investors. Profits from this investment channel can boost the cash flow for real estate investment. The more cash flow a property has, the better the return and the more income the real estate investor earns. Real estate is quite profitable investment channel, and it always increase in values over time.

By TRIEU TUNG – Translated by A.T