Over 3,000 foreigners bought housing in Vietnam between 2015 and the third quarter of 2023, 60% of whom were buy-to-gain investors, real estate service firm CBRE said in a report.
Buy and hold for capital appreciation remains the most popular strategy for foreigners purchasing residential real estate in Vietnam, according to CBRE’s “Vietnam: Two decades of urban development” report.
Some buyers may opt to let properties out as a temporary option while they wait for sales prices to climb. Very few non-Vietnamese - mainly long-term residents - purchase residential real estate for self-use.
In terms of product type, foreign buyers have displayed strong demand for condominiums, especially units in high-end developments in big cities such as Ho Chi Minh City and Hanoi. Well-located and affordable condominiums with potential for strong price growth have also been the subject of interest from foreign investors, the report adds.
Starting in 2015, the government began removing barriers to foreigners’ acquisition of real estate. The Housing Law 2014, which came into effect in 2015, permitted any foreigner allowed to enter Vietnam to purchase residential properties in the country.
Article 74 of Decree 99/2015 specifies documents proving persons eligible for owning housing in Vietnam. For foreign individuals, they must have a valid passport with an entry verification stamp from Vietnamese immigration authorities and are not eligible for diplomatic privileges and immunities according to regulations.
For foreign institutions, they must be eligible as per Article 159 of the Housing Law and have a valid investment registration certificate or documents permitted by a competent Vietnamese agency to operate in Vietnam that are still valid at the time of signing housing transactions.
While there remains no limit on the number of individual units a foreigner can buy in Vietnam, there is a cap on the percentage of foreign ownership in an individual project. This is set at a maximum of 30% per residential building or no more than 250 landed properties in an administrative unit.
Since the relaxation of restrictions on foreign property ownership, buyers from developed Asian economies including mainland China, Hong Kong, South Korea, Taiwan, and Singapore have accounted for 75% of residential property transactions in Vietnam, according to the CBRE’s report.
CBRE attributes this strong interest to their proximity to Vietnam; the pre-existing presence in Vietnam of large real estate developers from these markets; and Vietnam’s potential for price growth relative to their home markets, all which have experienced periods of rapid price appreciation.
Matthew Powell, director of property service firm Savills Hanoi, has tipped that a handful of Savills Vietnam’s ultra-wealthy foreign clients have been on the hunt for real estate investments in Vietnam since earlier this year.
This was the reason behind Savills’ expansion of its office in Vietnam. The office offers a world-class network of partners, experts, and contacts, providing comprehensive yet tailored and confidential real estate expertise and advice.