Billions of dollars of foreign capital are pouring into Vietnam's real estate.

As of August 31, newly registered and adjusted FDI capital in real estate reached 2.55 billion USD, 3.7 times higher than the same period last year. The relaxation of home purchase conditions for foreigners is also expected to help the real estate market receive billions of USD more from foreign capital.

According to the General Statistics Office, as of August 31, newly registered FDI capital in the real estate sector reached 2.4 billion USD, 5 times higher than the same period last year and accounting for nearly 20% of total new capital.

Including newly registered and adjusted capital, registered FDI in real estate reached 2.55 billion USD, 3.7 times higher than the same period last year.

Foreign capital inflows into the market will help Vietnam's real estate market accelerate its recovery. Photo: Pexels

In addition, FDI capital implemented in Vietnam in the real estate sector also reached 1.27 billion USD, double that of the first 8 months of last year and accounting for 9% of total FDI capital implemented. The 4 segments that are assessed to benefit the most from foreign capital inflows this time are industrial real estate, retail, office and housing.

According to Cushman & Wakefield Vietnam, from the end of 2023 to the first half of 2024, the market has recorded about 16 real estate M&A deals. Foreign investors are still targeting projects with clean land funds, good quality, real value as well as complete legal documents, and a lot of development potential.

Ms. Trang Bui, General Director of Cushman & Wakefield Vietnam, predicts that from now until 2026, a large amount of capital from foreign investors will be poured into the Vietnamese real estate market. According to foreign enterprises, the real estate segment is currently achieving a profit rate of 8-10%/year. This figure is relatively attractive and much higher than the 2-3%/year of countries in the region.

Not stopping there, the domestic real estate market is expected to attract billions of dollars more from foreigners who want to buy houses in Vietnam. With the new Housing Law allowing foreigners to extend their home ownership period up to 50 years, Ms. Le Thi Hang, General Director of Indochine Real Estate Company, said that this will be a lever, helping the market become more vibrant, especially in the high-end segment.

“Clear and transparent regulations on home ownership for foreigners will create the premise for forming an attractive investment environment, thereby attracting more FDI capital into real estate,” Ms. Hang shared with reporters of Investment Newspaper.

According to the General Director of Indochine, the policies on home ownership for foreigners in Vietnam are relatively open. However, this is not the only factor that encourages foreign customers to spend money. Advantages such as attractive selling prices and large development space are the reasons why foreigners, especially investors, come to Vietnam to invest.

Sharing the same view, Mr. Tran Vinh Phi Long said that ERA Galaxy Group is supporting many customers from Hong Kong, Taiwan, and Singapore to buy houses in Vietnam. In general, they all expressed optimism about the market growth rate, the product's ability to generate cash flow, and attractive tax rates.

“Foreign customers often look for high-end apartments in the city center. Price is not an issue, because compared to other countries, real estate prices in Vietnam are still much lower,” said Mr. Long.

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