Many
high-class condos projects had to reduce rental to $20 per square meter but
renters still want to negotiate lower prices, the Tuoi Tre Online reported.
Property prices in Vietnam market have
declined by 20-30% sharply so far, hence a lot of firms had to sell off
projects to repay bank debts, but the prices of high-class apartments will be
much lower.
The prediction was said by Marc
Townsend—Managing Director of CB Richard Ellis (Vietnam) global research and
consulting firm at the international conference themed “Credit Crunch: Where
from Here for the Vietnam Real Estate Market?” on November 23 in HCM City
hosted by DFDL Mekong law firm in corporation with CBRE and Standard Chartered
Bank.
Regarding the office-for-lease segment, Marc
Townsend spoke, the thing what renters are paying attention is competitive
prices and it is right time for companies to move headquarters and offices from
outskirts such as Dist 7, Tan Binh Dist to centre districts in HCM City.
In order to maintain and attract, property
investors need to improve current buildings and increase utilities of buildings
such as basements, decoration, energy saving, and seek opportunities to
re-negotiate rentals.
CRBE Vietnam forecasted the Vietnam real
estate market will remain gloomy 2012 in all segments. Only the segment of
properties for education, international kindergartens, healthcare, and beauty,
eating and drinking will continue generating good performance.
Sharing the point of view, Michael
Kokalari—Chief of Kimeng Securities Co’s information research department,
through talks with foreign investors in Vietnam, said that the investors from
US, Japan, Europe paid a great attention to consumer beheaviors of young
mid-class group in Asia generally and Vietnam particularly.
In the recent past, these foreign investors
bought back stocks of Vietnam’s consumer industry companies namely Masan, Huong
Thuy based on the development potential of this field, he noted.
Michael Kokalari assessed, despite the
property prices declined 20-30% as announced lately by PetroLand Co, Vietnam
real estate market has not gone to its equibrilium point. Many firms who were
facing difficulties in liquidity, bank debts are not desperate because it is
normal as debts increased in the crisis period.
David Tran, Vice Chair cum Director of the
Asian Real Estate Association of America (AREAA) in US stated at the conference
that the Vietnam real estate market is losing liquidity, so investors are
seeking money sources outside the banking system, and overseas remittance is
the way-out for property projects. If Vietnam continues improving legislative
environment, removing barriers in law on contracts, taxation policies for
foreigners, the realty market will receive a quite high volume of inward
remittances from 4.5 million Vietnamese overseas.
Meanwhile, according to Ta Chau—Director of
DFDL Mekong tax and law consulting firm, she was so excited to changes in
Vietnam’s laws in 2012.
Ministry of Finance proposed to open Real
Estate Investment Trust funds (REITs) which are expected to create a strong
movement in the market in following years. Through REITs, creating an easy
capital divestment regime whereby investors are able to withdraw capital if
necessary, she remarked.
Experts also recommended 16 changes in
property-related laws and regulations, including Law on Land, Law on
Investment, and Law on Enterprises. These changes may create negative moves in
Vietnam in next 5 years.
The Vietnam real estate market in 2012 is
determined by the government decisions, she confirmed.
VietBiz24
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