Ho Chi Minh City property – top tips
Here are ten insider tips for figuring out the Ho Chi Minh City property industry.
- In a bid to improve transparency, the Vietnamese government is in the process of compiling data aimed at helping investors and would-be home owners to monitor property sale prices. The Ministry of Construction’s real estate market indexes (REMIs) are expected to rise in Hanoi and Ho Chi Minh City and should be studied carefully by anyone looking to invest in either region.
- In a move which will bring it into line with practices in Thailand, Vietnam’s Ministry of Construction has said that it is in the process of drafting a decree that would force property firms to complete the foundations of apartments buildings before selling units in it. However, in the meantime, potential buyers should check to see the stage of the construction project before investing as companies who are later found to flout the law will face heavy fines which could then tie up capital and ultimately delay hand-over dates.
- Those thinking of investing in HCMC should look at District nine, which is located right in the centre of the ‘economic development triangle’. Considerable infrastructural development is being ploughed into the area and this may well be reflected in future residential unit prices.
- As always, it is advisable to obtain qualified legal advice when purchasing a property. Your legal team will advise on the title of the property to ensure you are getting exactly what you are paying for. In addition information can be obtained regarding any planning/building restrictions or permissions affecting the property. Planned developments for the area surrounding your property may also affect your decision to proceed with the purchase and your legal advisor should be able to obtain this information on your behalf.
- Financing a unit is set to become easier – local banks will be permitted to give mortgages to those who qualify for condominium ownership. So, if gathering the cash for your apartment is an issue, Vietnam may be able to provide both the condo unit and the means to finance it.
- Ho Chi Minh City has grown to accommodate more than eight million people, and is still developing. The government is in the process of building several major road projects around the city to accommodate its growing populace along with a number of new tunnels and bridges across the river to link the various city districts. Buyers should make sure they are aware of government plans for their area – a massive construction project on your doorstep could represent a major boon or a massive disaster.
- Foreigners considering the option of buying into HCMC residential units to rent them out should be cautious – at present the law does not permit foreigners to do let property they have bought – it must be occupied by either themselves or their family members. The law may be changed a later date, but it is certainly not a forgone conclusion that this will be the case.
- HCMC’s districts two, seven and Nha Be are particularly popular with foreigners who call the city home, but they are also areas most hit by speculation and prices are somewhat inflated beyond their value. Wise money looking to invest in these locations may consider adopting a ‘wait and see’ approach.
- A large proportion of new units coming onto the HCMC market over the next year or two will be mid and lower range – the market dip has prompted many developers to switch their attention to the city’s native middle-class who, with price reductions, are ready to get onto the property ladder.
- Despite the negatives, Vietnam (along with China) has the biggest potential for capital growth in residential and commercial property over the next two years new research which surveyed a range of property experts has claimed. Hong Kong, Singapore and Thailand follow were beaten into third, fourth and fifth positions.