 Viet kieu, foreigners invest in homes
Vietnam News - 8/25/2015 8:42:09 AM
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The changes to the housing law allowing foreigners and Viet kieu (overseas Vietnamese) to buy houses in Viet Nam (from July 1) has had an impact on the housing market.
The increasing number of successful deals in the past seven weeks is a good sign for the market, indicating further good times are in store for it.
Nguyen Bich Diep of Ha Noi's Thanh Tri District said her elder sister, who lives in Germany, has bought an 80sq.m apartment in Ha Noi for over VND2 billion (over US$90,000), and aims to rent it out if she cannot return to Viet Nam.
Minh Anh, another overseas Vietnamese from Germany, has bought an apartment in HCM City and said he would sell in soon if he can make a profit. Otherwise, he would let it out for lease.
"A return [on the investment] of 6 per cent is OK," Tin Tuc newspaper quoted him as saying. "It is equal to the interest rates offered by Vietnamese banks for one-year deposits and a little higher than interest rates at overseas banks."
Along with the increasing remittances, more and more overseas Vietnamese are returning home for business and investment.
They not only buy apartments, but also develop coastal accommodation (like guest houses), hoping to get better profits from these properties when coastal areas become prosperous, thanks to investment to boost tourism there.
A spokesperson for HCM City-based housing developer Novaland said overseas Vietnamese made up 10 per cent of the company's customers in July, with most buying apartments in upscale projects in prime locations.
Figures are not available on overseas Vietnamese buying homes in HCM City, but 112 have bought at Vinhomes Tan Cang, according to Le Hoang Chau, chairman of the HCM City Real Estate Association.
According to Tin Tuc newspaper, overseas Vietnamese prefer beach villas, apartments and street houses that can be used by themselves or let out for rent if required.
Remittances by overseas Vietnamese to HCM City have risen sharply in 2015. In the first seven months they were worth $2.42 billion, a year-on-year increase of 12 per cent.
Nguyen Hoang Minh, deputy director of the State Bank of Viet Nam's HCM City office, said remittances through city banks were estimated to rise to $5.3-5.5 billion.
They amounted to $5 billion last year, with 71.4 per cent invested in business and 21.1 per cent in housing, according to banks.
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