The country wants to catch up with its richer Asian rivals but for now it still offers good value for international homebuyers
In July 2015, new laws opened up the Vietnamese property market to expats. Any foreigner with a valid visa, whether resident or tourist, can now buy property on a 50-year leasehold, with options for extension. There are restrictions: foreigners can only purchase 30 per cent of any single condominium building or a maximum of 250 houses in any one administrative ward (overseas Vietnamese, or Viet Kieu, are exempted from these limits). Still, some investors are spying an opportunity. In 2008, when high-end property prices were at their peak, house prices recorded 110 per cent year-on-year growth. But with the global financial crisis, the bubble burst. The ensuing years were “toxic”, says Marc Townsend, managing director of CBRE Vietnam. “All the developers sat there with their cranes not turning and the contractors walking off and the banks scratching their heads.” As such, half-finished ghostly resorts, left to rot by bankrupted developers, still dot Vietnam’s coast. Recovery came in late 2014, helped by a growing middle class, rising wages, and rapid urbanisation (by 2025, half of Vietnam’s population will live in cities). Cranes are once again rising across Ho Chi Minh City’s skyline, while construction workers camp in makeshift homes under highways and chimneys belch out factory smoke overhead.
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