How do you invest in Vietnam real estate?

Delafon..you’d better check the latest property movements in Australia.    It’s “tanking”.    In the last 18 months prices in the main capital cities have declined 15%.   

Some have risen.....but only because they were cheap to begin with & in locations that were not as desirable.

Chinese property investment in Australia has fallen 70% in the last year.     All due to Chinese “gubberment” putting a freeze on the flight of capital.   Same things happening in Canada & New Zealand ,,they were flooded with Chinese money as well.    Yeah...they paid cash,,,but a lot of it was borrowed on the shadow banking game and illegal means

Google “project dragon four corners abc”  .  It’s about China tracking down property in Australia bought by Chinese with funny money.

People relying on Chinese property investors to prop up the market could be in for a surprise.   The chow banks are stuck with 3.5 TRILLION dollars in property loans invested in 65 MILLION stagnant ,vacant  piles on concrete that most Chinese can’t afford. 

The ones that can afford,,have already spent.  The rest don’t have the borrowing capacity to service a loan.    That ain’t good.    The Australian market is basically similar.   You can’t sell something to people who haven’t got money OR haven’t got the financial capacity to service the loans required to buy a place.

So ...that’s where the slump comes in...and who knows how long the  “ catch up game “ takes before buyers get into a Financial situation where they can service a loan or Buy outright.

There is a solution.......basic market forces.😆

The seller takes a haircut & shifts DOWN in price to meet the market.

By the way......property sellers in Nha Trang are starting to sweat. The bubble has burst, rents are dropping AND.... Chinese tourist numbers are actually FALLING.🤓.    I know a few VN who are desperately trying to sell land at a discount.    They know the games about to change.

Diazo :

Don't!!!!
T
he is not like you home country. The process is so filled with land mines. One there is no common law here like in much of the world. There is no law of contracts. There is not court to go and settle contractual disputes. And any body you go before here is for sale to the highest bidder. There is no ability to do title searches as in your country, Thus there is no ability to buy title insurance. Real estate prices are so inflated here that the last guy in is going to get burned. You hail from the country with the best environment to invest in real estate and you want to take a crap shoot on investing here while staying on your perpetually extended visa? Hope you think long and hard before you take the plunge. Yes, there will be many who chime in and espouse the great benefits of investing here. But you always must look at your real rate of return on any investment ( in RE we measure it by cap rate) and factor in inflation. No bargains here my friend. Then the infrastructure you get for your investment????? Potable water, firehouse nearby, etc etc

After 400 posts, Diazo's summary of the situation still sums it up best.

Yep..Diazo has called it well.   It’s a mugs game for foreigners unless your a Multi National using other people’s money.

In 8 years based here , and many years extended travel in SE Asia I’ve met many of the victims of the Asian property game.

And guess what.........they’re not the sharpest tack in the packet , are they ?

They all look the same ..🤪

It is unfortunate because my wife actually wants to buy another house to live in.  I won't live in hers - it's too small and too far away from where I work so we are renting in district 2 and she is letting family live in the one she owns for free, LOL. 

I'm not looking for investment property, not looking to flip, just a nice place to live.  I look at what I can buy where I'm from in the Midwest in the US (6B VND will buy a very nice 400 sq meter house on a 1,250 sq meter lot with a three car garage).  After I got divorced I bought and still have a 120 sq meter house on a similar sized lot that I paid less than 1B VND for.  As it looks  I will have to spend 8-10 B VND for 5x20 meters and have three flights of stairs to have something liveable. That's a lot of money for a house that is still in a third world country. 

We are here for another 18 months until her visa gets approved and then going to the US for 4 years until her daughter graduates from a US high school and then retire for 6 months in the US and 6 months in the winter in Vietnam.  Honestly I hope it does crash in the next few years so I can buy something at a price that I don't have to hold my nose to sign on the dotted line.

I have informed my wife and numerous VN friends that another decline in the market is on the cards....they say it wont happen.

We bought land in the countryside due to the fact that markets move first in the major cities, then the outer areas and finally the countryside. The land we just bought has increased 50% in a month. Once I see a downturn in the major cities in full swing, then it will be a case of selling our land and sit back and wait for a bargain if it arises.

There are a lot of people pretending they are honest but are in fact lying cheating pieces of dung .

zob24 :

There are a lot of people pretending they are honest but are in fact lying cheating pieces of dung .

Without using the quote button nobody will ever know who you are referring to.

For Yogi007 thanks a lot for your update about Chinese and Australia. This support my point that the same could very well happen here in Saigon / Vietnam in the coming months...

For Diazo, a bit outdated opinion, valid a couple of years back. The new 2015 real estate laws brought quit a few improvements. I bought 3 properties in Saigon area 1 year ago as long term investment. So far, so good, quite happy!

For SteinNebraska, I believe we are going to see a "market adjustment" in Vietnam in the next 6 to 18 months. Then it will recover again like a couple of years back.

colinoscapee :

I have informed my wife and numerous VN friends that another decline in the market is on the cards....they say it wont happen.

Yes, same with me.

zob24 :

There are a lot of people pretending they are honest but are in fact lying cheating pieces of dung .

Like everywhere in the world...
A bit more in Vietnam probably because they have been through hell during 100 years from end of the 19th century with Chinese, Japanese, French and US armies.....

For "market adjustment", read, "A lot of people losing their shirts".

Concerning the comparison between Australia and Vietnam real estate marked, I talked with an Australian friend specialized in the Australian REA market and a Vietnamese friend long time REA investor in Vietnam.
Here is a summary of my learnings:

1) Real estate in Australia has gone down recently because of the Chinese crack down on all those money launderers, high profile politicians et... But considering prices have risen for so long already. It is normal that they are in the early stages of a recession.

2) Vietnam real estate property only can be bought with cash, they don't provide loans for foreigners...

3)  We will see a slow down/price adjustment  on the Vietnamese market currently as  the prices are not as great as 2 years ago and several other factors.

4) After June, we might see strong pressure on prices levels as more than 60% of new property units will have been/be launched in district 2 and 9, like Empire City in Thu Thiem for example.

DELAFON :

Concerning the comparison between Australia and Vietnam real estate marked, I talked with an Australian friend specialized in the Australian REA market and a Vietnamese friend long time REA investor in Vietnam.
Here is a summary of my learnings:

1) Real estate in Australia has gone down recently because of the Chinese crack down on all those money launderers, high profile politicians et... But considering prices have risen for so long already. It is normal that they are in the early stages of a recession.

2) Vietnam real estate property only can be bought with cash, they don't provide loans for foreigners...

3)  We will see a slow down/price adjustment  on the Vietnamese market currently as  the prices are not as great as 2 years ago and several other factors.

4) After June, we might see strong pressure on prices levels as more than 60% of new property units will have been/be launched in district 2 and 9, like Empire City in Thu Thiem for example.

I think you need to do a lot more research into the fall of prices in the Australian real estate market than relying on your friends advice. The above quoted reasons are just not on. The prices here in the Northern Territory (Darwin) have been hit hard with the withdrawal of Implex (a major company) and with that many workers have left Darwin and headed back south. It is possible to pick up an appartment that was (3-4 years ago) fetching $800,000- $1,000,000 for $550,000-$700,000. These units all have fantastic views overlooking Darwin Harbour.

Thank you Wadey for your comment.

Good, so you confirm prices are going down.
I do not see the link with the Chinese except if Implex is a Chinese company.

I bought an apartment in hcmc about the same time as Diazo post in 2017 and the price has gone by 40% since then. 2-3 years ago property was still cheap and it’s insane to suggest with the GDP growth that prices were not going to move.

My only regret was that I didn’t buy more units because I felt it was cheap at the time. If you think HCM is expensive do a comparison with places like Manila or KL and understand that Vietnam will eventually surpass both these countries.

What is the pricing like at the moment sort of an average as I will be investing in property's as soon as I get there, dong value is fine I can convert
Thank you for that interesting post

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