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Vietnam Real Estate Newsletter - No. 67, Week 4 Jan, 2009


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Vietnam Real Estate Newsletter - No. 67, Week 4 Jan, 2009

  1. 1. Weekly Newsletter A67 Vietnam Real Estate Week 4, January The first weekly electronic newsletter issued to registered members, approximately 100,000 reads per month VietRees, a member of joining to develop the newsletter Market situation (p.2) Real estate foreign investment (p.3) Vietnam in the world (p.3) Real estate agents (p.3) Websites of real estate companies in Vietnam (p.4) Real estate projects and prices (p.5) Real estate supply for customer groups (p.7) Real estate legislation (p.8) Construction material market last week (p.8) Stock market last week (p.8) Research - Consulting (p.9) Market forecast, statistics expert opinions (p.10) This weekly newsletter is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning or interested in Vietnam real estate market changes. Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsible for the occurring damage. Please visit the website www.VietRees.com for further Vietnam Real Estate information. When individuals and organizations quote or publish the information from our newsletter, please cite the source VietRees. According to the statistics on registration for the newsletter, the subjects making reference to the newsletter includes real estate investors; companies or units of government performing management tasks, business marketing, consulting, broking, assessment, real estate finance, construction, banking, architecture, interior decoration; domestic and foreign press agencies; and full of professional investors or individuals who have demand for real estate throughout provinces and cities nationwide; typically Ho Chi Minh, Ha Noi, Da Nang, Can Tho, Hue, Nha Trang, BRVT, Binh Duong, Dong Nai, Ha Tay… We would like to say thanks to the sponsors and all of the readers. We expect to continue to receive your support as well as your comments to improve our newsletter. Readers can print or save this newsletter on your computers to review when needed or transfer it to others. However, think of environment when you want to print it out. Free register for weekly newsletter: Please send your email to marketnews@VietRees.com Sponsor and advestising: T: (84 8) 3948 5574 - E: properties@VietRees.com
  2. 2. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 2 MARKET SITUATION Although 2008 was considered to be an unsuccessful year for the Vietnamese real estate market, Real estate market in 2009: domestic according to many opinions, the big projects would gradually fall into the foreign corporations’ hand. enterprises be at an advantage However, currently, the biggest difficulty that has made the real estate projects with the foreign-owned Tien Phong – 17 Jan, 2009 investments delay or not properly follow the progress is that the capital disbursement will be hard due to the global economic crisis. Therefore, this is considered to be a golden opportunity for the big Vietnamese enterprises to regain the advantage in 2009. In fact, among the 20 ‘Golden Projects’ in Ho Chi Minh city licensed in 2006, there have been only 2 projects under construction & both of them belong to domestic investors. Many big projects in the heart of HCMC that are speeding up the progress also belong to Vietnamese enterprises and a series of other projects have also successfully raised the capital for the construction. In addition to some advantages such as: labor, materials, land price, etc, being at the low level, the housing demand for the small-size houses with suitable prices and the policy of kicking the demand for the cheap-price houses have also been great opportunities for Vietnamese real estate enterprises. Because most of foreign enterprises have aimed at the market segment of high-grade apartments which is highly unable to find customers. According to some real estate experts, the purchasing and leasing demands for the high-grade apartments have now been sluggish. The foreign-owned big projects will be hard to be converted or provide more products while the demand is still weak. Therefore, this is the chance for Vietnamese enterprises to be viable on their home market under the pressure of the foreign capital flows by some ways such as investing, trading in the low-price projects that suit their low capital source and are encouraged by the State. After over two weeks since the resolution on the pilot program of allowing foreigners to buy and own Foreigners buy houses in Vietnam: houses in Vietnam that takes effect on 1st January 2009, the HCM City real estate market has still seen the door is open but many people no positive signal. The main reasons include the global economic crisis, the high apartment prices, being still waver afraid of the complex administrative procedures. As soon as the policy was still “on paper”, many real estate experts were rather optimistic, even some people were afraid that the above “open-door” policy Nguoi Lao Dong – 17 Jan, 2009 will create a quot;stormquot; of purchasing houses in the big cities which would make high-grade apartments continuously increase in price. However, many high-grade apartment projects offer much potential, the number of foreigners coming to inspect has increased in comparison with before, but there still are no transactions. Through the survey, most foreigners really have demands for buying houses in Vietnam. However, the types of houses that they like often should meet particular requirements such as: able to be used as offices and accommodations, convenient for transportation, etc. With these factors, some apartment projects often do not meet the requirements in comparison with the types of townhouses and the apartment prices have still been quite high. Many experts have also shown that due to the global economic recession in general and the gloomy situation of the domestic real estate market in particular, the number of foreigners that have bravely poured money into the real estate industry at this time has still been limited. A strong possibility is that the foreigners have still pondered about the market situation & have not hurriedly made their decisions. Although the real estate market has not been warm yet, the stories about the transaction centers are Seek goods for real estate transaction getting hotter each day. A series of real estate businesses in the entire country are urgently setting up centers the transaction centers in accordance with the Real Estate Business Law and making every effort to Tuoi Tre – 21 Jan, 2009 market and seek goods for the future. The transaction centers not only include products of their own or the high-grade projects but also aim at the market of single houses such as land, houses in the old urban areas, with valid documents and prestigious investors. In addition, many transaction centers in some large cities in the whole country also cooperate to create the connection in terms of information of the domestic projects with the customers as well as the diversification of products. According to many real estate experts, the market still lacks products although many real estate projects have been started in the last weeks of 2008, (but they will only offer their products from 2010 - 2011 onwards). The real estate transaction centers opened in the past have just made the beginning, but unfortunately the real estate market has come to a standstill which leads to the shortage of goods and absence of customers. Meanwhile, the connection for adding products for the centers has still not been effective. The real estate experts suggest that it is time to consider opening transaction centers and the current centers also should upgrade themselves to meet the standards, otherwise the market will eliminate the centers that have little goods, few customers and operate ineffectively. Sponsor:
  3. 3. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 3 REAL ESTATE FOREIGN INVETSMENT On the morning 17th January, Au Lac Co., Quang Ninh (Tuan Chau Group) signed a contract with Holiday Villas hired to manage Holiday Villas Group (Malaysia) on managing the international tourism and amusement park Tuan Chau, Tuan Chau tourism site Ha Long city, Quang Ninh province. VietRees – 19 Jan, 2009 Besides the purpose of transferring the technology of hotel management with the international standards, Tuan Chau Group hopes that this is an opportunity to bring the tourists of Holiday Villas global system to Vietnam. List of the localities attracting most FDI in 2008 Department of Foreign Investment (under the Ministry of Planning and Source: General Statistics Office Investment) has shown that the total foreign investment in the real estate Ninh Thuan has continued to be the leading field across the country in 2008 is locality in attracting FDI in the list although it has 23.6 billion USD (accounting for had only 2 invested projects. However, Ho Chi 36.8% of the total FDI). Minh city is the place attracting the highest number of projects with 418 projects. The top target in 2009 is to ensure that FDI released will be equal to 2008 or below 2 billion USD. VIETNAM IN THE WORLD Vietnam is one of the countries Grant Thornton International Corporation has announced the global ranking board in terms of the prospects for the economic development and clearly indicated the reduction in the positive signals in the seeing the positive signs private enterprises through the observations of over 7,000 enterprises at 36 countries. Grant Thornton Sai Gon Giai Phong – Jan, 2009 has come to the conclusion that the decreasing demand is the biggest threat to the private companies. According to Grant Thornton, while the big economies such as the United States, Japan, and the European Union have fallen into the economic crises, Vietnam has still maintained the strong growth rate in 2008. The main reason for the decline is the impact of the inflation and the global financial crisis. This has made the positive signal of the enterprises drop from 87% (in 2008) to 32% in 2009. With this result, Vietnam has ranked 7th in terms of optimism level in 2009. The private companies have been more advantageous in the time of the economic recession because the management board of the companies can make the decisions quickly due to the simple system and flexible policies. Therefore, these companies will operate more effectively than the organizations with the bureaucratic management style. REAL ESTATE AGENTS Real estate business corporations Ministry of Construction is building the project of establishing the two economic groups, including Vietnam Cement Corporation and Phuong Nam Real Estate Investment – Construction – Business. The to be born Prime Minister has approved this project at the beginning of the first quarter 2009. TheSaiGonTimes – 19 Jan, 2009 Ministry of Construction is accelerating the rate of the progress of equalizing and arranging its corporations to join the groups, receiving the local businesses participating in the groups. Meanwhile, the Ministry also prepares the conditions and legal formalities to increase the charter capital of the corporations chosen as the cores for the groups. BCCI invests in constructing many Binh Chanh Joint Stock Investment Construction (BCCI) has shown that it will build some big projects in Binh Tan District, Ho Chi Minh City in 2009. big apartment blocks The first project is An Lac building area in An Lac A ward with the total area of 7,990 m2. The 18-storey VietRees – 21 Jan, 2009 building that includes 300 apartments with the total investment expected to be nearly 594 billion will be started in early 2009. Moreover, BCCI is also conducting setting up the document on basic designs and plans to start another apartment project, which is BCCI apartment block on a site of 4,000 m2 at An Lac ward in early 2009. In addition, the company has completed the preparation stage for the investment and will implement the apartment project Tan Tao 1 in Tan Tao A ward with the expected total capital of over 574 billion this year. Nguyen Do paid 10% of contributed On the morning of 21st January, 2009 Nguyen Do has paid 10% of the contributed capital to over 40 customers contributing their capital to The Adonis 1 project in Go Vap District, Ho Chi Minh City. capital to customers The company also intends to pay 10% of the contributed capital to the customers who bought the Nguoi Lao Dong – 21 Jan, 2009 apartments of The Adonis 2 project (Dist.8, HCMC) on 22nd January 2009. Sponsor:
  4. 4. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 4 Websites of real estate companies in Vietnam Property developers Brokerage Evaluation Ho Chi Minh Ho Chi Minh AREV - www.arev.com.vn Hoang Quan - www.thamdinhgia.com Company 585 - www.585.com.vn An Gia - www.angia.com.vn Vietland - www.thamdinhgia.com.vn Company 584 - www.congty584.com.vn ACBR - www.acbr.com.vn VVFC - www.valuation.vn An Phu - www.anphugroup.vn Dat Xanh - www.datxanh.com.vn BCCI - www.bcci.com.vn Dia Loi - www.nhadatdialoi.com.vn Daewon - www.daewon.vn Dat Cat - www.datcat.com.vn Construction Him Lam - www.himlam.com FICO - www.ficohome.com.vn Ho Chi Minh Hoang Anh Gia Lai - www.hagl.com.vn Kim Son - www.kimson.com.vn CIC8 - www.cic8.com Linh Phong Conic - www.conic.com.vn Phuc Duc - www.phucduc.com Coteccons - www.coteccons.com.vn Nam Long - www.namlongvn.com Hung Phu - www.hungphunhadat.com Cosaco - www.cosaco.com.vn Phu Long - www.phu-long.com.vn Hung Thinh 2 - www.diaochungthinh.com.vn Hoa Binh - www.hoabinhcorporation.com Phu Quoc Land - www.phuquocland.net Hoang Quan - www.hoangquan.com.vn Hai Thanh - www.haithanh.com.vn SacomReal - www.sacomreal.com Intresco - www.intresco.com.vn Toan Thinh Phat - www.toanthinhphat.com.vn Sadeco - www.sadeco.com.vn Loc Dien - www.nhadatld.com Resco - www.rescovn.com Nova - www.novahomes.com.vn Ha Noi Thai Thinh Capital - www.richlandhill.com.vn Phat Hung - www.phathung.com.vn Constrexim - www.constrexim.com.vn Thu Duc House - www.thuduchouse.com SacomReal - www.sacomreal.com Cavico - www.cavicovn.com Phu My Hưng - www.phumyhung.com.vn Tan Dien - www.tandien.com.vn HANCIC - www.hancic.com.vn Van Phat Hưng - www.vanphathung.com.vn HUD - www.hud.com.vn Vietnam Land SSG - www.saigonpearl.com.vn Ha Noi Incomex - www.incomex.vn Cland - www.cland.com.vn Ha Noi Dong Do - www.dongdobds.com Architect and Interior Decoration Phu Thai Group - www.phuthaigroup.com FPT Land - www.fpt-land.com Ho Chi Minh Petrowaco - www.petrowaco.vn C.E.O - www.ceoholdings.com.vn Petrolimex – www.pland.com.vn A2 Visualization - www.a2viz.com.vn Gia Tue - www.giatue.com.vn Cat Moc - www.catmoc.com.vn HUD - www.hud.com.vn Other cities Nha Vui - www.nhavui.com HDB Viet Nam - www.hdbgroup.com.vn Nha Viet - www.nhavietdecor.com Keangnam - www.eng.kne.co.kr Dieu Hien - www.dieuhien.com.vn Nha Dep - www.nhadep.com.vn Nam Cuong - www.namcuong.com.vn Thien Loc - www.thienlocnhadat.com.vn Pho Xinh - www.phoxinh.com.vn Song Hong Land - www.songhongland.com.vn Vinaconex - www.vinaconex.com.vn Research Vincom - www.vincom.com.vn Ha Noi CBRE - www.cbrevietnam.com Viet Hung - www.ecopark.com.vn Savills Viet Nam - www.savills.com.vn ACT - www.act.com.vn VietRees - www.VietRees.com ADKientruc - www.adkientruc.com Other cities Ashui – www.ashui.com Consulting Kien Truc Ha Noi - www.kientruchn.com Becamex IDC - www.becamex.com.vn Biconsi - www.biconsi.com.vn CBRE - www.cbrevietnam.com Other Countries Tuan Chau - www.tuanchau-halong.com.vn Dong Duong - www.indochina-consulting.com GNSVINA - www.cozyvill.com Eden Real - www.edenreal.com Architects 61, Sing - www.a61.com.sg Company 579 - www.cecico579.com.vn Hop Nhat - www.uniland.com.vn DP Architects, Sing - www.dpa.com.sg Duc Manh - www.ducmanhco.com Indochina Land - www.indochinacapital.com SWA, USA - www.swavietnam.com Long Gia Khang - www.longgiakhang.com Ong&Ong, Sing - www.ong-ong.com Savills Viet Nam - www.savills.com.vn RSP Vietnam, Sing - www.resp.com.sg Vina Capital - www.vinacapital.com Surbana Vietnam, Sing - www.surbana.com Sponsor:
  5. 5. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 5 REAL ESTATE PROJECT AND PRICES Thanh Phu residential area – Dong The whole ground bases of the Thanh Phu residential area project in Vinh Cuu District, Dong Nai has been sold out after only three days offering for sale (from 13th January, 2009). Nai sell out ground bases The 64 hectares residential area include chains of 70 - 120m2 row houses, 180 - 259 garden houses, TheSaiGonTimes – 17 Jan, 2009 the public works as the administrative center, education, health, culture, trade... aiming at the customers with average income and the trading price averages about 126 - 250 million VND/base which is divided into several payment phases. Breaking ground of Saigon Givral Sai Gon Joint Stock Givral (investors) and Joint Stock COTEC Construction (Construction) held a ceremony to start the construction of Hotel Saigon Givral at 144 Nguyen Van Troi Street, Phu Nhuan VietRees – 20 Jan, 2008 District, Ho Chi Minh City on 14th January, 2009. The hotel includes 14 floors and 1 basement with 192 rooms following 4-star standard. It is expected to be completed in 2010. Works start on Mui Ne tourism site Mui Ne resort at quarter 5, Mui Ne ward, Phan Thiet city, Binh Thuan province has been started on a site of nearly 3.4 hectares with the total investment of over 105 billion. Nhan Dan – 21 Jan, 2009 The building features Asian architectural style close to nature, including villas, guest houses of 1 - 3 floors along with meeting rooms following the national standard, restaurants, the entertainment and fitness center. The project is expected to be inaugurated in 2011. In general, the prices of the high- The price change level of high-grade apartments in HCMC grade apartments in HCM City VietRees has recorded that in 2008, April and May had the highest decreases with 15% and 10% respectively. continue to decline VietRees – January, 2008 According to the statistics of VietRees, the prices of the high-grade apartment in December continued to decrease by about 6% as compared to November 2008. This has been considered to be the highest decrease from June 2008 until now. Announced prominent real estate developments during the last 2 weeks* Week 3 January 2009 Week 4 January 2009 SaiGon Givral Hotel (Phu Nhuan Dist.) Ho Chi Minh City Mui Ne Resort (Phan Thiet) Other cities Approved prominent real estate developments in HCM City* December January Truong Tho apartment building (Thu Duc) Nguyen Cu Trinh Complex (Dist.1) Housing, apartment, residential area ReA building An Phu – Binh Khanh (Dist.12) Cecico 135 apartment building (Thu Duc) * Note: RA=Residential Area, AP=Apartment Building, HA=Housing Area, RuA=Reurban Area, TA=Tourism Area, IA=Investment Area, UA=Urban Area, ReA=Resettlement area Websites of properties in Vietnam Ho Chi Minh Ha Noi Other cities Blooming Park - www.bloomingpark.com Viglacera Tower - www.viglaceraland.vn Cozyvill - www.cozyvill.com Saigon Paragon - www.saigonparagon.com My Dinh – Me Tri RA - www.sudicosd.com Flamingo Dai Lai - www.flamingodailai.com Dragon City - www.dragonland.com.vn Bac An Khanh RA - www.vinaconex.com.vn Van Phu township - www.dothivanphu.com Preche - www.preche.com Ha Noi Plaza Hotel - www.charmvit.co.kr Dam Vac Golf - www.damvacgolf.com SaigonPearl - www.saigonpearl.com.vn Phap Van – Tu Hiep RA - www.hud.com.vn Sanctuary - http://sanctuary.com.vn V-Star - www.v-star.com.vn Ho Tram Strip - www.hotramstrip.com Time Square - www.timessquare.com.vn Sai Gon Sunbay - www.ctc-corp.vn Other cities The Everrich - www.theeverrich.com Eden Lagi Resort - www.edenreal.com Furama Resort - www.furamavietnam.com Tan Da Court - www.tandacourt.com Van Quan – Yen Phuc township - www.hud.com.vn Sai Gon – Mui Ne Resort - www.saigonmuineresort.com Lancaster - www.lancaster.com.vn Quoc Te Do Son - www.vietlandgroup.com Sunspa ResortVietnam - www.sunsparesortvietnam.com The Vista - www.thevista.com.vn Sponsor:
  6. 6. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 6 Property Retail Price Updated on information from ACBR, Van Phat Hung, Hung Thinh, Phuc Duc, Tuoi Tre Newspaper and developers (VietRees gathered by direct surveys), listed prices can be original prices or transfer prices at current or at one week prior from the date this newsletter is issued. Typical apartments in HCM city Other apartments and land lots Area Price (million +/- Dist. (m2) VND/m2) Apartment building – HCMC Central Garden 1 87 32.6 Sailing Tower 1 104.6 65.6 - An Phu – An Khanh 2 141 13.5 Binh Minh 2 180 15 - V- star, Dist.7 Sky Garden , Dist.7 Cantavil, Dist.2 Nguyen Phuc Nguyen 3 97 25 * 119.2m2 - 15.1million VND/m2 * 71m2 – 30.9 million VND/m2 * 75m2 – 25.3 million VND/m2 Hung Vuong Plaza 5 132 25.7 - * 130m2 – 31.9 million VND/m2 Kien Thanh 6 60 12.2 - Carina Plaza 8 99 13.7 - The Mansion BC 84 12 Dat Phuong Nam BT 107 20.5 PN Techcons PN 140 23.5 + Phuc Yen TB 80 13.2 - Riverside Garden TD 89 14.9 Development land lots – HCMC The Everich, Dist.11 Blooming Park, Dist.2 Phu My, Dist.7 An Phu – An Khanh 2 200 23 + * 117m2 – 1,600 USD/m2 Area: 95 – 398m2 * 82m2 – 19.5 million VND/m2 Thanh My Loi 2 200 11.2 Price: 1,800 – 2,400 USD/m2 Phu My - VPH 7 126 18 - Direct contact with the investor1 Nam Long 7 120 25 Khang An 9 144 6.5 + Phu Nhuan 9 258 6.1 - 6B Intresco BC 100 14 Phu Xuan - VPH NB 144 8.2 + Sadeco Phuoc Kieng NB 312 13. Apartment building – Ha Noi Dong nam Tran Duy Hung CG 145 26 Preche, Dist.2 Panorama, Dist.7 Saigon Pearl, B.Thanh Nghia Do CG 50 15.2 + * 147m2 – 2,222 USD/m2 * 164m2 – 37.8 million VND/m2 * 84m2 – 2,390 USD/m2 Thanh Cong DD 122 28 * 133m2 – 2,200 USD/m2 Lilama HM 78 23.5 Ciputra TH 182 32.4 Vuon Dao TH 126 22 - Bac Ha TX 80 15 Development land lots – Other provinces My Phuoc 3 BD 300 1.45 + Rach Bap BD 220 1.2 + Khang Linh BR-VT 125 6.5 The Manor, B.Thanh New SaiGon, Nha Be The Vista, Dist.2 Tay Nam BR-VT 100 1.8 * 98,9m2 – 16.9 million VND/m2 * 35m2 – 1,723 USD/m2 * 107,9m2 – 1,955 USD/m2 Nam Can Tho CT 100 2.2 * 110m2 – 2,000 USD/m2 * 472m2 – 2,150 USD/m2 HUD DNI 300 1.58 - Lang chuyen gia Tan Do LA 130 2.6 + 1 Kien A Investment & Services Co., Ltd. - An Phu Ward, District 2, HCMC - Tel: (84.8) 740 6688, Fax: (84.8) 740 6949 Danang: 225 Huyen Tran Cong Chua - T: (84) 511 836 216 * HCMC: 390 Nguyen Cong Tru, D.1 - T: 8 821 7509 * Hanoi: No.6-1D Trung Yen New Town, Caugiay - T: 4 783 1598 Sponsor:
  7. 7. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 7 PROPERTY SUPPLY FOR DIFFERENT TARGETS OF CUSTOMERS * Saigon Construction Corporation investor two apartment blocks high 5-storey for workers in Quarter 1, Social welfare houses for worker Linh Trung Ward, Thu Duc Dist, HCMC. VietRees * Hung Vuong JSC has just put a 5-storey apartment building into use for cadres and workers. The company continues to petition Tien Giang Provincial People’s Committee to grant a 5.000m2 land area to construct more apartment buildings for workers with an investment of 100 billions VND. * Saigon Paper JSC has put an apartment building into use for workers at My Xuan Commune, Tan Thanh suburban district, Ba Ria - Vung Tau province. The stage 2 of the apartment building is about to be implemented with a scale of 8 storey. th * Morning of August 28 , 2008, the Ministry of Construction has signed a memorandum for the cooperation in the field of welfare housing with Korean Ministry of Land-Traffic and Marine. * Ha Noi Construction Investment JSC (Hancic) has finished 4/10 units of the 5-storey house which belongs to the housing project for workers at Kim Chung Commune (Dong Anh). * Construction and Import-Export JSC (Vinaconex) has transferred and put into use 4 blocks of houses among the total 16 blocks of the housing project for the workers at Thang Long industrial zone. * The housing area of 7,000 m2 (380 rooms) for 1,500 workers of Dong Quang Knit Limited Company at Hai Son industrial cluster (Duc Hoa Ha commune, Duc Hoa suburban dist., Long An province) has just been put into use. The total investment cost of this housing area is 20 billion VND. (02/10/2008) * The 4-storey apartment building at cluster 5, ward 8, Vinh Long town that serves the cadres, employees, professional serviceman and etc has been ratified by Vinh Long Provincial People's Committee with a total investment of over 37 billion VND. (03/10/2008) * Sai Gon – Gia Dinh Real Estate Company and Hoa Binh Phu Yen Company build Thoi An Apartment Real estate for the low income Building in District 12 with 1,000 apartments. VietRees * Construction Co. No.8 (CIC8) will invest in construction of 10,000 Keppel Land apartments & Tien Phuoc Co. will build a resettlement area including 1,900 apartments at An Phu, Binh Khanh, District 2. * HCM City People’s Committee will advance 50.5 billion to carry out the project of Vinh Loc B, Binh Chanh residential area for resettlement with hundreds of townhouses and 40 apartment blocks. * Construction Co. No.5 will invest in construction of 500 apartments at Ward 22, Binh Thanh District. * HCM City Cooperative Alliance has developed its construction investment project of housing area at Le Minh Xuan Commune, Binh Chanh Suburban District on a site of 67.49 hectares. * 50% of the house reserve at The Splendor apartment area (Go Vap Dist.) will be intended to serve resettlement demand in the district. * Dat Lanh Co. will offer 1,500 apartments to the market with the prices of 500 - 700 millions VND/unit. * People‘s Committee of HCMC has approved the project of the resettlement area on a site of 55.24 hectares at Dong Nam Cu Chi industrial - residential area in Cu Chi. * House management of Dist.1 is assigned to construct the resettlement area at 7/4ª Kha Van Can, Thu Duc district. * In early 2010, Hai Thanh company will complete 352 apartments of Hai Thanh 1 resettlement area project, Binh Tan District for the civil servants at Binh Tan District. * People’s Committee of Binh Chanh has just cooperated with Hung Vuong university Investment & Development JSC to construct resettlement area at Tan Kien commune, Binh Chanh suburban district. * People’s Committee of HCM City has just licensed Cho Lon Real Estate JSC to invest in the construction of the apartment building at No. 99 Ben Binh Dong, ward 11, district 8 in order to make the house reserve at the social welfare housing program. * People’s Committee of HCM City has promulgated the decision about reclaiming the land areas at Phuoc Kien, Nhon Duc and Phuoc Loc communes, Nha Be suburban district for the construction of the resettlement area in order to serve the project of Nhon Duc - Phuoc Kien new urban area. * The HCM City Union of Housing Co-operatives has prepared to commence the construction of Thanh Loc apartment building with 238 apartments on a site of 6.600 m2 in District 12. The Union intends to construct another apartment building with over 200 apartments at Truong Tho ward, Thu Duc district. * HCMC People’s Committee has ratified the planning of Binh Khanh residential area (Dist.2) which is built on a site of 384,019 m2 to serve the resettlement of the locals in Thu Thiem new urban area. * Dat Xanh has cooperated with Truong Son Vanguard Youth General Squad to build apartments for low- income people at Dist.12 * Go Vap People’s Committee and Go Vap Public Benefit Service Co. have bought back the house reserve belonging to Phu Gia Hung high-end apartments, Duong Quang Ham Street, Ward 15, Go Vap Dist. and Dong Hung Thuan 1, 2 apartment buildings, Dist. 12 to serve the resettlement of the locals at Tham Luong project - Ben Cat - Nuoc Len ditch. * Approximately 184,000 apartments belonging to the investment program in the construction of the social welfare houses in the stage of 2009 – 2015 with the total investment of about 49,000 billion VND have been submitted to the government for approval. (30/09/2008) * 800 social welfare houses for lease - lease to purchase will be built at 19A and 21A plots, Viet Hung urban area in 2009, which have been ratified by The People’s Committee of Ha Noi City. (16/10/2008) * 462 units of Khang Gia 3 apartment building (Go Vap Dist.) invested by Khang Gia Real Estate Investment – Development JSC will be used for the resettlement demands. (27/10/2008) The Committee for overseas Vietnamese in HCMC has showed that there have been 130 overseas Dwellings for overseas Vietnamese Vietnamese buying houses, mainly in HCMC. Those who brought houses are those who come back to and foreigners the country for their long term and direct investment, scientists, culture researchers invited to come back to the country to become experts and repatriating overseas Vietnamese. To buy houses, beside VietRees documents verifying priority subjects, the buyer must present their passport (issued in Vietnam). In the case that house buyers bring foreign passports, they must have certificates of Vietnamese nationality or documents confirming their losing Vietnamese nationality, or certificate of citizenship registration. Sponsor:
  8. 8. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 8 REAL ESTATE LEGISLATION Ha Noi City People's Committee has just decided the construction permit fees for people’s individual Construction permit fee: VND 50,000 dwelling houses to be VND 50,000/permit. All kinds of other works adhere to the level of VND 100,000. Kinh Te Do Thi – 17 Jan, 2009 The new construction fee is also promulgated by Hanoi city in accordance with the functions and locations for building and is calculated on the percentage basis of construction costs. The houses that are invested by the organizations or individuals and used for living, not for business operation should submit 0.5% (for districts and Ha Dong) and from 0.1 to 0.2% of the total construction costs (for the remaining suburban districts and Son Tay). Ministry of Construction has sent a proposal to the Government on offering the preferential conditions to Favoring those investing in welfare the investors building dwelling houses for the subjects that lease and purchase the low-price or welfare houses houses. Tien Phong – 18 Jan, 2009 Accordingly, the project investors will receive the preferential treatment in terms of land, tax, credit, planning and infrastructure: (1) are exempt from land using and leasing costs. (2) The construction density and land-use factor are adjusted to be maximum1.5 times greater. (3) Paying 0% VAT and the tax rate on corporate income is 10% of taxable income. (4) Offered preferential loans or repaid the interest rate according to the regulation by the State. (5) Allowed to take out loans from the local funds of housing development. The Ministry of Finance has just sent the document to Tax Bureau to provide the guidelines on Problems related to personal income calculating the personal income tax for transferring real estate. tax when transferring real estate Accordingly, the individuals that transfer the use rights of land and works associated with land will pay VietRees – 20 Jan, 2009 the tax for transferring the land-use right if they submit the legal documents to the State management offices before 1st January 2009 and the tax agencies publicize the tax notice. For the cases of transferring the apartment buildings submitting the documents before 1st January 2009, the personal income tax against the house value should not be collected. For the value of the allocated land (if any), the tax on transferring the land use rights should be collected. The personal income tax for the incomes from transferring real estate is calculated following the tax rate of 2% based on the prices of the transferred properties written in the contracts. For the individuals transferring the real estate with full valid documents, valid records that certify the transferred prices, original prices and the costs relevant to the transfer activities and the tax payers propose applying the tax rate of 25% on the income because the tax rate that has to paid is lower than the tax rate of 2% applied to the transferred prices, the tax is calculated following the methods of applying the tax rate of 25% on the incomes from transfer activities. CONSTRUCTION MATERIAL MARKET Not let cement be scarce The Government office has just had the official document informing of the solutions to stabilizing the market and stimulating the cement demand. The solutions to stabilizing the market and kicking the Edited by VietRees cement demand which were proposed by the Ministry of Construction have been ratified. In addition, the Government has also asked the Ministry of Construction to direct the enterprises to actively implement the methods of reducing the product costs, developing foreign and domestic consumption market. The year 2009 is expected to complete the construction and put 18 cement projects into operation with the total capacity of 20.47 million tons of cement. By the end of 2009, the total capacity of reverted furnace cement factories in the whole country has reached 56.8 million tons. Along with 3 million tons of the vertical shaft kiln cement factories that are currently operating, the total capacity of the cement industry has reached nearly 60 million tons. Thus, the production capacity of the domestic cement factories in 2009 meet the consumption demand and there is no shortage of supply. STOCK MARKET Two bourses converse and slightly * At Ho Chi Minh bourse, at the opening time of the market, the prices of some blue-chips have increased and up, Vn-Index exceeds 300 threshold, pulled the VN-Index up 0.64 points to close at 300.68 HasTC-Index surpasses 100 landmark points. The total trading volume of this phase has reached Edited by VietRees nearly 750 thousand units worth over 18 billion. Entering the consecutive order-matching phase, the upturn has Chart Source: Vietstock continued to be maintained, VN-Index has added 0.92 Up to date: 22 Jan, 2009 points as compared to 301.6 points of the first phase. Ending the session, VN-Index has added a total of 1.08 points as compared to the previous sessions, up to 301.12 points. The total trading volume on the whole market of this session has only reached 4.6 million units worth approximately 103 billion VND. Therefore, from 19th to 22nd Jan 2009, Vn-Index has only had 1 upward session and 3 downward sessions. As compared to the last week, Vn-Index has lost 5 points (from 306.12 down to 301.12 points). * In Hanoi, after losing points in 8 consecutive sessions and falling down to below 100 points yesterday, in today’s session, HASTC-Index has come back to the upturn when adding 0.56 points to close at 100.31 points. The total trading volume on the whole market has reached 2.24 million units worth 57 billion VND. Similarly to Ho Chi Minh bourse, HASTC-Index has also had 3 downward sessions and 1 upward session from the first week to 22nd January 2009. Hanoi bourse has also lost 2.53 points as compared to the last week (from 102.84 down to 100.31 points). Free register for weekly newsletter: Please send your email to marketnews@VietRees.com * Sponsor and advestising: T: (08) 3948 5574 - E: properties@VietRees.com
  9. 9. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 9 RESEARCH – CONSULTING Solutions to enhancing the competitive abilities of the Vietnamese real estate enterprises 1. Why should the Vietnamese real estate 4.1. Enhance the management ability and train In addition, the enterprises should combine with enterprises enhance their competitive abilities? the leaders of the enterprises. universities and colleges to recruit excellent Enhancing the competitive abilities of the To develop the above abilities, the decisive factors undergraduates in order to build the active young Vietnamese real estate enterprises is an are the activeness and positive striving of every team to undertake the important professional indispensable thing in the process of integration businessman. positions in the near future. especially in the difficult situation of the current real According to VietRees, firstly, the leaders of the estate market and the decline of the economy, enterprises should pay attention to enhancing the 4.7. Build up a good image to the public. helping the real estate enterprises stand firm on essential skills and update the modern knowledge. Any enterprise understand clearly that if it wants to their feet & develop in the coming years. Thereby, Some knowledge and skills should be updated and have a good public image, firstly, it has to win the it has contributed to enhancing the competitive systematized. If the basic skills are combined with customers’ trust by the quality of its service power of the whole economy. On the other hand, the effective management knowledge, there will be products, the marketing business activities and in the current situation of the market, if the the decisive impacts on the managers of the real after-sales service, etc. competitive abilities are not enhanced, the estate enterprises. Thereby, this contributes to Through the marketing and after-sales strategies enterprises will be able to suffer the losses, close improving the competitive abilities of the real estate to promote the enterprises’ own brands, if this down and go bankrupt. According to VietRees, to enterprises. work is well implemented by real estate assess the competitive ability of one real estate enterprises, it would be very convenient for them enterprise, firstly the real estate enterprises need 4.2. Improve the quality of service products and to raise the capital through issuing their shares to identify the internal factors and external factors the diversity of the provided services and bonds to the public. impacting on their competitive abilities. When the source of real estate products is However, the real estate marketing activities on According to VietRees, the essential internal growing, the quality of service products is getting the current market have not received the proper factors that the enterprises need to use to assess more attention of the customers. The quality of the investment from the investors, including the big the competitive ability of one real estate enterprise real estate service products should deserve the real estate investors. When the market was include: money that customers have paid. The enterprises eventful as in 2006 - 2007, the investors mainly • The quality of service products have to rearrange the structure of the products in focused on the phase of organizing the sales, the many segments, direct the products at the current • The diversity of provided services events and introducing the products and the needs of the customers and take the quantity to • Human resources marketing activities through media took place very offset the profits (for example: investing in the incoherently and inconsistently. • The ability to develop the market housing segment for the medium - income and The investors have not created the difference or • Trademarks and the prestige of the real estate low-income people). prominence for their real estate products besides enterprises the architectural design elements. Many investors • Financial ability 4.3. Build up the market information have had many large real estate projects and • Organizational and management ability of the department; regularly follow and fully update traded products on their own but they have not had real estate enterprises the movements of the market through the mass the marketing/business departments, marketing • The real estate information system media channels and the actual surveys. departments or the professional staff that are in • The level of using the information technology This is not work that any enterprise can also well charge of marketing. The external factors influencing the competitive perform while the real estate market information In the current difficult situation, a few real estate abilities of the real estate enterprises can include has become less transparent as now. When there companies have had many new marketing ways, the macroscopic policies of the government – the have not been State agencies that can organize, aiming at the real customers. law factor, the domestic and foreign competitors, collect and analyze the market information, the real the capital market, the psychology of the subjects estate enterprises should choose the prestigious 4.8. Expand the channels of raising capital for joining the market, etc. For these external factors, units to agree on providing suitable and essential the real estate enterprises. the real estate enterprises are very hard to information for their enterprises. In fact, according The current capital source of the real estate intervene, change or adjust. Therefore, the to the VietRees, it has been so hard for many enterprises has mainly come from the commercial enterprises only need to thoroughly study and businesses to carry out this work on their own. In banks. Although the banks have reduced the loan understand the external factors and focus more on the case that they cannot build up and effectively interest rates, the loan conditions have become the internal factors. operate a team to handle this work, they can more difficult than before. As a result, only a few perform this through professional units that real estate enterprises can borrow money from this 2. How to enhance the competitive abilities of specialize in researching, providing the market main capital channel. A few companies have the Vietnamese real estate enterprises information and consultancy in terms of real estate. issued the shares on the stock market but they To enhance the competitive abilities, one of the could not raise much capital because the stock things that the enterprises need to do is to actively 4.4. Expand the business investment market market has been freely falling. evaluate their real ability and find out the most following the specific routes depending on the In addition to the capital borrowed from the banks basic strength in order to promote the flexibility in scientific results of the market research and mobilized from the stock market, the each economic period. surveys. enterprises should expand issuing the enterprise According to VietRees, only when the real estate bonds and real estate bonds from the real estate enterprises possess, construct and promote their 4.5. Build up the legal department in each projects that they invested, meanwhile, promoting key competitive abilities in comparison with other enterprise having the function of offering legal the works of the joint-venture, cooperation and competitors, they can have the sustainable and consulting to the managers and hold the works merger for development. long-term development. of preventing the crisis risks. This definition will help the enterprises build the Summary: 4.6. Improve the real estate knowledge of the effective development and competitive strategies. In the current market situation, if the competitive current employees and attract the good abilities have not been enhanced and there have 3. The weaknesses in the competitive abilities employees. not been the basic strategies, the enterprises will This is the weakness of most of the Vietnamese of most of the current real estate enterprises be able to suffer the loss, close down and go • The quality and competitive abilities in terms of enterprises in general and the real estate bankrupt. To ensure the objectivity in assessing enterprises in particular. To have highly management are poor. the competitive abilities, VietRees would like to • The human resources are not methodically professional staff, the enterprises need to have the advise the enterprises to perform this work strategies for holding and attracting talents. To trained in terms of the real estate field. seriously and probably need the help of the enhance the work effect, every enterprise should • The real estate information lacks transparency. prestigious consultants on the market. offer professional training courses to the key staff • The quality of work is bad. On the other hand, no matter how they assess, in order to suit its requirements in each period. • The financial ability is low. they also need to have the bases to compare with Therefore, the effective training programs and other enterprises that are in the same operation • The weakness in terms of brand. plans have been one of the methods that the field, market segment and directly and indirectly • Not really aiming at their right customers. enterprises have used to enhance the competitive compete with them. abilities. Meanwhile, the enterprises should pay • Not understanding and strictly execute the law. attention to building up the reasonable treatment 4. Solutions to enhancing the competitive policies such as salary policy, bonuses to keep the stability in their volume of staff, especially the abilities VietRees – December 2008 excellent staff. Free register for weekly newsletter: Please send your email to marketnews@VietRees.com * Sponsor and advestising: T: (08) 3948 5574 - E: properties@VietRees.com
  10. 10. VietRees – Vietnam Real Estate www.VietRees.com Viet Nam Real Estate Newsletter A67 Page 10 REAL ESTATE MARKET FORECAST * Note: Information on market forecast is only updated every 4 periods (after one month) by VietRees – January, 2009 The transaction situation of apartments, townhouses and project ground bases in December has General tendency of Ho Chi Minh continued to decrease. According to VietRees’s forecast, the real estate prices can continue to go down City market with the decrease of approximately 5% per month in December and before Lunar New Year. The property prices in 2009 are hardly likely to be on the upturn. The successful transactions at the end of December last year was a little bit higher than the previous months. However, the transactions have just focused on the segment of low-value townhouses and apartments. For the group of the high-grade apartments, the rate of the successful transactions was quite low and inconsiderable. The amount of overseas national currency exchange at the end of this year has dramatically dropped and not been invested in the real estate field as in the previous years but it has been used for the production or paying the debts. The difficulties in the credit situation, the deflation of the economy and the coming maturity of the contracts mortgaged by the properties have made many properties to be sold out at the prices that are quite low, even lower than the initial selling prices of the investors. The total outstanding real estate loans have accounted for nearly 10% of the debts of the whole the banking system, therefore, the banks demand payment of the debts. And as a result, many investors have to sell their projects and products at the low prices. Many real estate enterprises have lacked the cash to maintain their business and it is very hard to borrow more money from banks. On the other hand, currently, some banks have consigned the mortgaged high-grade properties of the customers for sale and extended the debts so that the customers have more time to sell their properties in order to pay the loan contracts. The supplies of the apartments belonging to the medium and low segment have been quite limited; Apartment market therefore the market belonging to this segment has also seen no changes as compared to the previous month. Many high-grade apartments with low prices (mainly belonging to those who sell out their properties) are hunted for. Meanwhile, the situation of checking the prices of the sellers has appeared on the market through the self-listed selling prices that are quite low. The sellers have really not wanted to sell because they will suffer considerable losses if they do so. However, if they offer the high prices (though suffering little losses), it will be very hard for their properties to be sold at this time. The high-grade apartments have seen few customers, especially many apartments in Phu My Hung and many other areas in District 2 and 7. Although the prices have dramatically declined (over 50%), there have been few buyers. With the movements of the current market, according to VietRees, the prices of the high-grade apartments will continue to go down after Lunar New Year. Project ground base market Although the prices of the project ground bases have considerably dropped, they have still been too high to those who have real housing demands. As a result, the transactions have been are also very low. If these people have real housing demands, they will choose the apartments or townhouses, not buying ground bases. Therefore, the transactions have still been very slow. The prices of many ground base projects in some areas of District 7, Nha Be have declined by 60% but the successful transactions have still been very scarce. Many investors are worried about the ability of selling their real estate in the current difficult situation of the economy and the frozen market. Real estate companies Many previous companies that expanded their real estate business investment have now come back to their main business fields. Many secondary investors have faced many difficulties such as no cash and no customers. If this situation continues, the real estate investors who lack the capital will face bankruptcy risk; have to sell the projects at low prices and withdraw from the market in 2009. In fact, according to VietRees, there are a lot of middle-ranking and senior managers have withdrawn or temporarily withdrawn from this field or reciprocally convert their assignments between the real estate companies. According to VietRees, the real estate investors should switch to the apartment projects with suitable prices for the medium-income people, instead of aiming at the projects with the high prices like before. The medium-price projects can be sold quickly; help turn over the capital and take back the capital quickly. Then, the capital has been continued to be used for reinvesting in serving the customers who have the real demand because the demand of this group of customers has still drawn little attention and not been properly exploited yet. Forecast in 2009 The real estate market with the current movements under the growing impacts of the financial crisis and global economic recession, the Vietnamese real estate market has seemed to be gloomier. VietRees has shown that there is a faint possibility that the market will recover in 2009. The market in 2009 will have more difficulties than in 2008. Many real estate investors and speculators will face the bank payments while the real estate prices have still not seen any signs of the recovery. According to VietRees, after Tet holidays, the real estate market will be an attractive playground and opportunity for the investors with the large capital and long-term investment strategies. The decline of the market will minimize the speculation. The market will be under the control of buyers, not sellers like before. For this reason, the potential real estate enterprises should build the long-term development strategies and actively work in the research and development, especially seriously investing in researching the market and customers; sustainable developing and avoiding the investment on a large scale in the current difficult situation. The coming investment trends The tendency of switching to the investment and development of the low-and-popular-price houses to attract the majority of customers is getting clearer. Many enterprises are planning to promote their for Vietnamese real estate investments in this market segment. It is expected that those who have medium and low incomes have enterprises many opportunities to approach this supply in the future. According to VietRees, enterprises should invest in the apartments with the relative areas of 40 – 60 m2, good structure, relatively good materials and equipments – (not need to be high-level ones), the selling prices of nearly 10 million/m2. The apartments with the value of around 400 – 600 million VND/flat will be likely to attract many customers. The customers that should be aimed at include the young families, students, workers and civil servants in Ho Chi Minh. In fact, some foreign investors are interested in this market segment. Therefore, the domestic investors should be quicker because, according to VietRees, Vietnamese enterprises can have more advantages than other foreign enterprises in this market segment. 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