Inward remittance flow at the year end is seen as the
sole hope of real estate investors as all channels of capital mobilization for
projects are almost getting stuck, Vietnam Economic Times reported.
Property investors are trying
to survive by waiting for a new capital flow which is expected to feed the
unmoved projects because of capital shortage.
The expectation is reasonable
because Vietnam is one of the highest remittance recipients in the world.
Moreover, in the gloomy air of finance and stock market, a part of overseas
remittance to Vietnam may be invested in property.
Data of the State Bank of
Vietnam (SBV) showed that despite the world economy remains difficult, the
amount of inward remittances to Vietnam during this year continues increasing
sharply. In the first three quarters of 2011, the amount averaged at
approximately $2.5 billion per quarter.
In the whole year, the
country’s inward remittance is estimated at around $8.5 billion, $500 million
higher than 2010.
Reportedly in November by World
Bank and Western Union Asia-Pacific, four million Vietnamese overseas are
living, working and studying in 101 nations, including 400,000 exported
workers. Vietnam was ranked in top 10 remittance recipients in the world.
With these data, the property
investors are expecting a new capital source to boost the uncompleted projects
based on the National Finance Supervision Committee’s latest survey showing
that 4,000 households received remittances, and 52% of the amount was invested
in real estate and the remainder was kept in savings and consumption.
Experts said, while the gold
and US dollar markets are not favourite investment channels any more, the stock
market also is going down. Especially, as banks were forced to apply the
ceiling deposit rate of 14% pa, a large amount of deposits was withdrawn from
the banking system. It is forecasted that a part of the deposits were
re-invested in the property market.
However, according to
statistics of WB, up to 90% of overseas remittances are flowing to rural areas
where the workers came from. Therefore, Vu Tuan Hung—Director of Thinh Phat
Construction Co said, investors of condominium projects in big cities will be
hard to benefit from the overseas remittance.
Only a small part of the
remittance may be sent to banks or invested in some channels by relatives of
overseas senders.
Since 2010, the number of
Vietnamese overseas registering to buy houses in homeland has declined. But, in
fact, the number of relatives of Vietnamese overseas registering to purchase
properties is increasing.
Director of Archi Invest Nguyen
Thanh Nam was quoted as saying that his firm is expecting much in overseas
remittances at the end of this year. To head off the new wind, Archi Invest
decided to open the sale of the Nine Ivory resort project in Ba Vi Dist (Hanoi)
to meet the remittance recipients’ demand of long-term investment.
VietBiz24
Business & Investment Opportunities
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