Feb 15, 2013

Vietnam - In crisis, multi-million dollar villas attract Vietnamese millionaires

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VietNamNet Bridge – While the real estate market gets frozen, multi-million dollar villas still can be sold well. It’s now the right time for the “big guys” to buy luxurious villas, as they have become cheaper than ever.

The poor spend money on food, the rich on villas

Some years ago, “multi-million dollar villas and resorts” meant the big scaled projects of foreign developers, like the one on Da Nang seashore where the most expensive villa was priced at $2 million.

In fact, the luxurious products were once put on sale in Hanoi. Two years ago, a real estate firm offered to sell 40 high end villas in Ba Vi mountainous area near Hanoi. Another real estate developer introduced over 10 lakeside villas in Dong Mo area.

However, the projects have fallen into oblivion, because the developers just showed the projects on paper, while the projects have not yet to be implemented, because of the investors’ financial problems.

However, other high end villa projects still have been living well in the crisis, because their investors have powerful financial capability. Ten high end villas priced at between VND60 billion and VND150 billion have been marketed.

Especially, the buyers would possess the villas for ever and the campus of 1,200-2,500 square meters. They would also be given pine trees, beaches and marinas with the total space area of up to 1000 square meters.

The most expensive villa there is priced at VND152 billion, or $7 million. However, the project developer believes it would be easy to find buyers.

While the resort projects in the suburbs have been left unsold, though the sale price is just several million dong per square meter, the luxurious villas worth multi-billion dong still have been selling well.

This shows that the market demand is still high and that all products are salable if they have reasonable targeted clients. While the majority of buyers turn their backs to luxurious projects, a small group of people are still ready to spend big money on high end products.

The salesman of a big resort project in the sea city of Da Nang said the apartments here have the lowest sale price at VND4 billion, while a penthouse at VND15 billion. Meanwhile, a villa is priced at between VND28 billion and VND40 billion.

A villa in Vinh Phuc province reportedly is as expensive as a whole project, but the project’s developer has revealed he has received two orders so far.

Who are the buyers?

Six years ago, a resort in Hoi An ancient town in the central region was put on sale at the starting price of US$500,000-700,000, and all of the buyers were foreigners.

However, things are now quite different. The main buyers of the high end projects nowadays are Vietnamese, 80 percent of whom are from Hanoi.

Especially, the big guys spend huge sums of money to buy luxurious products not to re-sell later for profit or to lease to others for money. If they plan to make investment, they would rather buy the houses in inner cities which have higher liquidity than the expensive villas with weak liquidity in the areas.

The millionaires buy the multi-million dollars just to satisfy their passion of holding huge assets. Many of them buy villas just to show off their fortunes, or spend free time at the villas with family members or friends.

Duy Anh

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