Vietnam Real Estate Newsletter - No. 70, Week 3 Feb, 2009


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Vietnam Real Estate Newsletter - No. 70, Week 3 Feb, 2009

  1. 1. Weekly Newsletter A70 Vietnam Real Estate Week 3, February 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.2) Vietnam in the world (p.3) Properties on 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.9) Stock market last week (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 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 Sponsor and advestising: T: (84 8) 3948 5574 - E:
  2. 2. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 2 MARKET SITUATION Since 1992, after the Land Law was promulgated, the real estate market has experienced three price Three factors able to heat up fevers. The first fever occurred at the end of 1993 and lasted until 1994 - 1995, then froze for 6 years. In real estate after 2010 2001 - 2002, the second fever occurred, then frozen within 5 years. Early 2007 and late 2008 saw the Thoi bao Kinh te Viet Nam – 16 Feb, 2009 third fever period occur. Since then, the real estate market has fallen into a frozen period in terms of the transaction volume, investment capital and prices. Until now, the investment in the real estate market has continued to go out rather than go in. In which, the main reason is that the real estate market fell into a frozen situation for a year. Currently, prices have continued to decline. Investors or speculators have not dared to further invest because there continues to be a large inventory of goods while the previous loans with high interest rates have matured. Those who have real demands are still expecting further price decreases. In addition, in terms of types of products, while the real demands are apartments with small sizes and prices of about 300 - 500 million VND; investors have still focused on building apartments and villas with sizes of hundreds of s.q.m and the prices of up to ten billion VND. Furthermore, the construction material costs have dramatically dropped as compared to the peak and currently, it has been stagnant. Meanwhile, the real demand for buying houses has been very considerable. According to the prediction of experts, the real estate market will not warm up until 2010. At that time, it will warm up the transaction situation first and then, the prices due to the following reasons: (1) the supply of dwelling houses has now been plentiful including the goods of constructors and speculators. (2) Although the housing demand has been large, it became weak last year and will continue to go down in the following years due to the low incomes and payment abilities. (3) According to statistics, the later real estate price fever has been about 5 years distant from the former one and the frozen period has come between them. However, the hot / cold cycle is able to be quicker or slower. According to the real estate consultants, investors have shown that they have become more cautious Hanoi real estate market in flux about the trend of changes of the market in the first months of 2009. Thong Tan Xa Viet Nam – 17 Feb, 2009 For the office market in Hanoi, building owners have more clearly realized the competition among the supplies in the future. And they have started to offer the reasonable rents because there are many tenants who are ready to move their offices to the buildings suitable for their financial situations. Currently, the unoccupied area of the grade B and C offices has been over 10%. Many 2 - 3 storey buildings with great locations have also been unoccupied. Only grade A offices have still kept the occupancy rate of nearly 100% despite the still-high prices. The Hanoi office market will continue to have the adjustments in 2009 because the total office supply has still been very large. For the housing market, the demand will also decrease due to the gloomy economy and the psychology of expecting further price decreases. Therefore, the house buyers will continue to wait while the sellers will still keep goods because they do not want to reduce the prices. In fact, the difference between the supply and demand of the real estate market in Hanoi in particular and in the whole country in general has still been great. As a result, many enterprises have still bravely invested in the projects with high feasibility. REAL ESTATE FOREIGN INVETSMENT Delverton Group Inc (UK) has just started the resort project Delverton Vietnam at the sand hill close to Start project Delverton Vietnam the coastline of Bai Chua - Hoa Thang commune, Bac Binh district, Binh Thuan province. in Binh Thuan The site is 100 hectares in size with 3 sides bordering the sand hill and the remaining side being VietRees – 16 Feb, 2009 coastline. The total investment is over 260 billion and divided in two phases. According to the design, the rooms are equipped with the advanced facilities; arranged relatively separately from each other and own fairly large sizes. The areas for relaxation, recreation and sport are isolated from others, including swimming pools, volleyball playground and sports at the beach. During the investment time of 5 years, the project Delverton Vietnam also aims at building the telphers, trains for yachts, golf courses… to diversify the tourism development services. Hai Phong city People's Committee has approved the investment projects to construct the first 18-hole Ratifying the first golf course golf course on island in Viet Nam Xuan Dam, Cat Ba island, Cat Hai district and it is expected to be on island started in the middle of March, 2009. Sai Gon Giai Phong – 17 Feb, 2009 Xuan Dam golf course is located in the complex of tourism and finance Venus - Cat Ba and invested by the International Investment Corporations Giico. The total investment of the community is 600 million USD. On 18th February 2009, Yueh Fei Company Vietnam (Taiwan) has signed a management contract with Nikko hotel brand enters Ho Chi JAL Hotels Company (Japan) to start the construction of 5 star hotel Nikko Saigon at 235 Nguyen Van Minh City Cu Street, District 1, Ho Chi Minh City with the investment of 100 million USD. Thoi bao Kinh te Sai Gon – 18 Feb, 2009 The hotel belongs to the second phase of Royal Center project, including 22 storeys and 3 basements with 335 rooms and 47 serviced apartments, conference rooms, restaurants, gyms and the high-grade store system. The hotel is expected to be completed in October, 2011. Sponsor:
  3. 3. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 3 VIETNAM IN THE WORLD Vietnam ranked 3rd in middle-term Vietnam is ranked 3rd in terms of development prospect in the mid-term, which is one of the surveying results of the operation situation of 620 Japanese companies in foreign countries in 2008 conducted by development Japanese International Cooperation Bank (JBIC) and presented at the Ministry of Planning and Kinh Te Do Thi – February, 2009 Investment on 11th February. Despite being ranked 3rd in terms of the development prospect for the business & production activities in the middle term (after China and India), the rate of supporting Vietnam has decreased as compared to 2007. The reasons why Vietnam has been highly appreciated include the good location for investment diversification, the low labor cost, the good development ability of the domestic market and the available supplies for the assembling industry. However, the problems that have still hindered the investment into Vietnam include the poor infrastructure development, difficulties in keeping the leaders of the companies and technicians / engineers, increasing labor costs, and the weak system of law enforcement. The fields that Japanese companies have been interested in when investing in Vietnam includes electrical / electronics appliances, automotive, general machinery and chemicals. PROPERTIES ON THE WORLD Investment in Singaporean real The investment in Singaporean real estate market in 2008 has decreased by 67% as compared to one year ago to be at just nearly 18 billion Singapore dollars (nearly 12 billion USD). estate market dramatically decline Meanwhile, the figure in 2007 was 54 billion Singaporean dollars. This figure is recorded in the report of Property-Report CB Richard Ellis on Asian market in the last half of 2008. In which, over 96% of the investment in real estate in 2008 was poured into the first stage of the year, mainly focusing on building offices for lease. The Singaporean real estate market that went down in the last half of year 2008 with the record decrease has made the investors more cautious. According to the survey of CBRE, most of the investors have decided to implement the strategy of “observing and waiting”. They have shown that once the Asian market recovers, the Singaporean market will have opportunities. REAL ESTATE AGENTS Opening real estate coffee shop International brand JSC (Inter Brand) has just opened the real estate transaction center InterLand at 12 Nguyen Thi Minh Khai Street, District 1, Ho Chi Minh City on the morning of 12th February, 2009. InterLand In addition to the services relevant to real estate such as advertising, sales, legal consulting, investment BDS & TS – 16 Feb, 2009 consulting. The center also serves the drinks and light food such as a coffee shop. InterLand center will focus on the high-grade and medium products in HCMC and all over the country. Begin distributing the complex Colliers International Group has shown that the investor of the complex project Central Garden has chosen it as the official distributor and this would be implemented on 18th February 2009. project of Central Garden Central Garden project includes the office building Office Zone & the complex of high-grade apartments - VietRees – 17 Feb, 2009 trading services with 3 blocks of 22 storeys on a large site of 8,000 m2 at Ben Chuong Duong Street, District 1, Ho Chi Minh City. HCMC: high-grade apartment Hoang Anh Gia Lai Corporation (HAGL) has officially announced the discount on prices of high-grade apartments at the two projects Hoang Anh River View - District 2 and Phu Hoang Anh - Nha Be prices decline suburban district to respond to the program of kicking the demand started by Government and to VietRees – 18 Feb, 2009 contribute to heating up the real estate market. Accordingly, as compared to the prices HAGL announced in late 2007, the average prices of Hoang Anh River View apartments have decreased by 950 USD/m2 (from 2,300 USD/m2 down to 1,350 USD/m2) and Phu Hoang Anh apartments have slid from 1.800 USD/m2 to 1.250 USD/m2 (decreasing by 550 USD/m2). The company has shown that the apartments offered for sale in this discount program accounted for 50% of the total sizes of the both projects. The 330 clients previously paying for the apartments of these projects will be readjusted according to the current prices. Tricon Towers opened on Hanoi On 18th February 2009, Minh Viet Investment SJC has started the next stage of the apartment project Tricon Towers in the heart of the new urban area An Khanh North, Ha Noi after completing the base real estate market structure. Ha Noi Moi – 19 Feb, 2009 With a total investment of over 145 million USD, the project includes 3 towers of 45 storeys with 732 high-grade apartments built on a site of 17,000 m2. It is expected to be completed before the third quarter of 2011. Tricon Tower is designed by RDC global design consulting company and Clodwell Banker Real Estate Management and Business Consulting Company (American) exclusively offers market consulting and operation management to this project. UDIC to build 170,000 m2 housing Urban Infrastructure Development Investment Corporation (UDIC) has shown that over 40 works and projects have been started in 2008 and at the beginning of 2009. floor area It is estimated that in 2009, UDIC will provide the market with about 170,000 m2 housing area. The Kinh Te Do Thi – 19 Feb, 2009 successful implementation of the construction investment projects will create a big market for other business production business fields such as consulting, construction, industrial production & construction materials. Sponsor:
  4. 4. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 4 Websites of real estate companies in Vietnam Property developers Brokerage Evaluation Ho Chi Minh Ho Chi Minh AREV - Hoang Quan - Company 585 - An Gia - Vietland - Company 584 - ACBR - VVFC - An Phu - Dat Xanh - BCCI - Dia Loi - Daewon - Dat Cat - Construction Him Lam - FICO - Ho Chi Minh Hoang Anh Gia Lai - Kim Son - CIC8 - Linh Phong Conic - Phuc Duc - Coteccons - Nam Long - Hung Phu - Cosaco - Phu Long - Hung Thinh 2 - Hoa Binh - Phu Quoc Land - Hoang Quan - Hai Thanh - SacomReal - Intresco - Toan Thinh Phat - Sadeco - Loc Dien - Resco - Nova - Ha Noi Thai Thinh Capital - Phat Hung - Constrexim - Thu Duc House - SacomReal - Cavico - Phu My Hưng - Tan Dien - HANCIC - Van Phat Hưng - HUD - Vietnam Land SSG - Ha Noi Incomex - Cland - Ha Noi Dong Do - Architect and Interior Decoration Phu Thai Group - FPT Land - Ho Chi Minh Petrowaco - C.E.O - Petrolimex – A2 Visualization - Gia Tue - Cat Moc - HUD - Other cities Nha Vui - HDB Viet Nam - Nha Viet - Keangnam - Dieu Hien - Nha Dep - Nam Cuong - Thien Loc - Pho Xinh - Song Hong Land - Vinaconex - Research Vincom - Ha Noi CBRE - Viet Hung - Savills Viet Nam - ACT - VietRees - ADKientruc - Other cities Ashui – Consulting Kien Truc Ha Noi - Becamex IDC - Biconsi - CBRE - Other Countries Tuan Chau - Dong Duong - GNSVINA - Eden Real - Architects 61, Sing - Company 579 - Hop Nhat - DP Architects, Sing - Duc Manh - Indochina Land - SWA, USA - Long Gia Khang - Ong&Ong, Sing - Savills Viet Nam - RSP Vietnam, Sing - Vina Capital - Surbana Vietnam, Sing - Sponsor:
  5. 5. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 5 REAL ESTATE PROJECT AND PRICES More apartment blocks for low- Danang House Development Investment has been handed over the land area of 11,839 m2 at the residential area to the South of Tran Thi Ly bridge (My An Ward, Ngu Hanh Son District) implementing income people in Da Nang the construction of the apartment areas for the households with the low incomes. Thanh Nien – 15 Feb, 2009 The project that consists of 7 apartment bays with 252 apartments (45 - 50 m2/unit) has been approved by Municipal People's Committee. The total investment is 65.2 billion VND. The company is also in charge of building internal roads and amusement parks for the whole area. Van Tuong ecological urban area On 17th February 2009, Quang Ngai People's Committee has approved the detailed plan for the construction, adjustment and design of Tuong Van urban area. Nguoi Lao Dong – 17 Feb, 2009 Accordingly, the project has an area of 3,828 hectares, belonging to the Hai Binh commune, Phu Binh, Binh Tri and Binh Phuoc - Binh Son district. This will be the urban area combined with the ecological reserve and be one of the urban - industrial - service centers of the key economic region of the Central, Vietnam. Build Lang Viet 5-star tourism area Trung Viet JSC held a groundbreaking ceremony to start the construction of Viet village tourism area at Truong Da hamlet, Hue City invested by the company on the morning of 19th February 2009. VietRees – 20 Feb, 2009 The tourist area is the first one that has reached the 5-star standard in Hue, including a total investment of 100 billion VND and it is built through 2 stages. The first stage is built on a site of 7 hectares with the main items including: a reception area, a service center, a sport area, pavilion, a handicraft village, resort- spa, a festival area and other technological infrastructures. It is expected to be completed after 2 years. The second phase will increase the total area of the project to 30 hectares and build the high- grade bungalows with specific features of the garden houses in Hue. In January, 2009, the prices of the The price change level of high-grade apartments in HCMC high-grade apartments in HCM City to light VietRees – January, 2008 Announced prominent real estate developments during the last 2 weeks* Week 2 February, 2009 Week 3 February, 2009 Nikko Saigon 5-star hotel (D.1) Ho Chi Minh City High-grade housing area Hemisco (Ha Dong) Apartment area for low-income people (Da Nang) Other cities Van Tuong ecological urban area (Quang Ngai) Vietnam Delverton resort (Binh Thuan) Xuan Dam golf course (Hai Phong) Lang Viet 5-star tourism area (Hue) Approved prominent real estate developments in HCM City* January February Nguyen Cu Trinh Complex (Dist.1) Housing, apartment, residential area * 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 - Viglacera Tower - Cozyvill - Saigon Paragon - My Dinh – Me Tri RA - Flamingo Dai Lai - Dragon City - Bac An Khanh RA - Van Phu township - Preche - Ha Noi Plaza Hotel - Dam Vac Golf - SaigonPearl - Phap Van – Tu Hiep RA - Sanctuary - V-Star - Ho Tram Strip - Time Square - Sai Gon Sunbay - Other cities The Everrich - Eden Lagi Resort - Furama Resort - Tan Da Court - Van Quan – Yen Phuc township - Sai Gon – Mui Ne Resort - Lancaster - Quoc Te Do Son - Sunspa ResortVietnam - The Vista - Sponsor:
  6. 6. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 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 Landcaster 1 120 68.85 - Sailing Tower 1 104.6 76.5 + B27 2 62 14.6 + Binh Minh 2 108 15.5 - Cantavil, Dist.2 V- star, Dist.7 Sky Garden , Dist.7 Nguyen Phuc Nguyen 3 101 26 * 150m2 – 1,800 USD/m2 * 119m2 – 15 million VND/m2 * 71m2 – 27.8 million VND/m2 Orient Apartment 4 71.7 21.9 + An Phu 6 83 15.5 Carina Plaza 8 100 12.7 - Gia Phu BT 69.4 10.2 Botanic PN 109 28.3 + PN Techcons PN 140 25.4 Bau Cat TB 56 15.6 + Sunview 2 TD 71 12.7 Development land lots – HCMC Blooming Park, Dist.2 Phu My, Dist.7 The Everich, Dist.11 An Phu – An Khanh 2 200 24.3 + * 83.6m2 – 20.5 million VND/m2 * 112m2 – 1,610 USD/m2 Area: 95 – 398m2 Binh Trung Dong Cat Lai 2 240 10.8 * 114.2m2 - 21.4 million VND/m2 * 150m2 – 1,675 USD/m2 Price: 1,800 – 2,400 USD/m2 ADC Phu My 7 100 13.5 - Direct contact with the investor1 Kim Son 7 200 23.5 Bac Rach Chiec 9 80 12.2 Nam Long 9 90 11.7 Lang Viet Kieu BC 100 12 Nam – Nam Sai Gon BC 140 5.5 Tan Kien BC 100 7 - Apartment building – Ha Noi Preche, Dist.2 Panorama, Dist.7 Saigon Pearl, B.Thanh Chelsea Park CG 98 25.5 Dich Vong CG 62 18.9 * 147m2 – 2,222 USD/m2 * 121m2 – 34.7 million VND/m2 * 84m2 – 2,217 USD/m2 Thai Thinh DD 114 25.6 * 166m2 – 35.5 million VND/m2 * 135m2 – 2,041 USD/m2 Hoa Lu HBT 65 34 Song Da HD 94 15.6 Linh Dam HM 74 14.2 + Viet Hung LB 70 9.5 Development land lots – Other provinces My Phuoc 3 BD 150 1.49 + Rach Bap BD 222 1.073 + Lan Anh 2 BR-VT 100 2.3 + The Vista, Dist.2 New SaiGon, Nha Be The Manor, B.Thanh Thien Loc CT 100 2.4 * 101m2 – 1,625 USD/m2 * 121m2 – 18million VND/m2 * 38m2 – 1,775 USD/m2 Nam Long CT 114 6 * 135m2 – 1,525 USD/m2 * 139m2 – 1,810 USD/m2 Phuoc An – Long Tho DNI 100 2.4 Nhon Trach DNI 100 2.1 1 Kien A Investment & Services Co., Ltd. - An Phu Ward, District 2, HCMC - Tel: (84.8) 3740 6688, Fax: (84.8) 3740 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 Viet Nam Real Estate Newsletter A70 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 nd been put into use. The total investment cost of this housing area is 20 billion VND. (2 Oct,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 rd Committee with a total investment of over 37 billion VND. (3 Oct,2008) * Hiep Phuoc accommodation and 1 apartment block in District 9 is reserved for over 1,600 workers in th Hiep Phuoc industrial zone and hi-tech zones - Directed by HCMC People’s Committee (22 Jan, 2009). * 4 three-storey apartment blocks (204 rooms) reserved for nearly 1,000 workers in Ha Quang export garment factory and Tay Bac Dong Hoi industrial zone with the rent of 100,000 VND/ month/ person have th been put into use after Lunar New Year – Quang Binh - Dai Phong Co., Ltd (4 Feb, 2009) * 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 D.1 is assigned to construct the resettlement area at 7/4ª Kha Van Can, TD D. * 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 th have been submitted to the government for approval. (30 Sep, 2008) * 800 social welfare houses for lease - lease to purchase will be built at 19A and 21A plots, Viet Hung th urban area in 2009, which have been ratified by The People’s Committee of Ha Noi City. (16 Oct, 2008) * 462 units of Khang Gia 3 apartment building (Go Vap Dist.) invested by Khang Gia Real Estate th Investment – Development JSC will be used for the resettlement demands. (27 Oct, 2008). * Replacing 0.3 million m2 floor of the old apartment buildings in District 1, 4, 5, 11, Binh Thanh, Tan Binh, Tan Phu and building 4 apartment buildings: 107 Truong Dinh (Dist. 3), Soai Kinh Lam ( Dist. 5), Building B (plot Q), Nguyen Kim apartment building, Building B (plot B, C), Ngo Gia Tu apartment building - Department of Construction (Jan, 2009). Sponsor:
  8. 8. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 8 REAL ESTATE LEGISLATION Regulations on management of According to the Decree No. 12/2009/ND-CP that has just been promulgated by the Government and includes the regulations on managing the construction investment projects, the national important construction investment projects projects or group-A projects include composition projects. If each composition project can independently Ha Noi Moi – 16 Feb, 2009 operate or exploit following the investment period, it can be managed & implemented as an independent project. The division of projects into the composition projects is decided by the investors. For the projects using other capital resources (including private capital), the investors shall decide the form and the management content for the projects. For the projects using many different capital resources, the parties who contribute the capital shall agree on the management methods or manage the capital resource which accounts for the largest percentage in the total investment according to investment. The decree also stipulates the inspection and evaluation of the investment in the construction investment projects. Accordingly, for the projects using the state-owned capital that occupies over 50% of the total investment, their investments must be inspected and assessed. For the projects using other capital resource, the inspection and assessment of the investment are decided by the investors. Hanoi: collecting fees of exploiting Along with the regulations on the fees for some administrative fields, Hanoi city People's Committee has just promulgated regulations on collecting the costs of exploiting and using the documents concerning land information land in the city. Bao Xay Dung – 18 Feb, 2009 According to the decision, the individuals and organizations who have demands for exploiting and using land materials of the authorized State agencies must submit the using and exploiting fees. The cost for organizations is 200,000 VND/ per time/ a document. The cost individuals and households is 100,000 VND/ one time/ a document. In addition, the services such as granting land survey map, co- ordinates, heights, etc are 30,000 VND/per time. The agencies of internal affairs are entitled to exploit the land documents free of charge. Peole’s Committee at commune level The People's Committee at the commune level is allowed to grant the construction permit for single houses located in rural residential area. This ratified content is in the Decree on project investment allowed to grant construction permits construction management that has just been promulgated by the government. VietRees – 20 Feb, 2009 Accordingly, the People's Committee at the suburban district level shall grant the construction permits to single houses in urban areas within their administrative borders and some other works. The People's Committee at the provincial level is entitled to grant the permits to the special construction works, grade- 1 works, religious works, historical - cultural monuments; statuary works, advertising works, the works on the main routes and streets in the urban areas. Investors need to have permits before starting their construction, except for the cases of building works belonging to the State’s secret, works under the urgent orders, works temporarily serving the construction of the main works; works following the routes that do not go through the urban areas but suits the ratified construction planning and works belonging to the construction investment projects approved by the authorized agencies. Ho Chi Minh City * The lowest price is 300,000 VND/m2 Land prices in 2009 stipulated (position 5, road No.8, coeffient 1) * Urban land: not exceeding 81 million VND/m2 according to price list by the Ha Noi * 2,700 road stretches/ routes have new prices, state 675 sections/ routes keep the prices unchanged * Price of land within the city: 2.5 - 67.5 million and 1,899 stretches/ routes have the prices VND/m2. adjusted. The land price can be adjusted not to * Price of land in the towns: 1.5 - 16 million Used as the basis to calculate the tax for exceed 20% as compared to the maximum price VND/m2. using land; transferring land use right; and the minimum price. calculating the money for land use and lease * Price of land in the rural area: 150,000 VND - Can Tho when handing over the land; leasing land 2.25 million VND/m2. without via auctioning land use right or inviting * The highest price of 17.5 million VND/ m2 is Hai Phong bids for projects using land; calculating the for land on Hai Ba Trung street. * Urban land: the highest price is over 30 value of land use right when handing over the * The highest land price is 6.5 million VND in million VND/m2. land without collecting land-use money of the Binh Thuy District. organizations, individuals; determining the * As compared to 2008, the land price has had Dong Thap value of land use right and adding it to the an average increase of 30%. Especially, some asset value of the state-owned enterprises * Urban land: the The highest price is 15 million areas such as Do Son, Duong Kinh, Cat Hai when they are equitized; calculating land-use VND/m2 in Sa Dec town and 14.4 million districts have the increases of 100 - 225%. value for compensation when the government VND/m2 in Cao Lanh City. Thua Thien Hue reclaims land, etc. * The price list of urban land in 2009 has * The highest price is 26 million VND/m2. supplemented 46 new road routes and adjusted 147 road routes with the popular increase of * The lowest price is 320,000 VND/m2. Edited by VietRees Nghệ An 200,000 – 1 million VND/m2. February, 2009 * Cua Lo and Thai Hoa towns: the highest Nha Trang price is 6.2 million VND/m2 and the lowest * The highest price is 18 million VND/ m2 (equal price is 50,000 VND/m2. to 2008’s prices) – the stretch from the South of * Vinh City: the highest price is 30 million VND/ Tran Phu bridge to Ana Madra hotel (position 1, m2 & the lowest price is 320,000 VND/m2. road No.1, coefficient 1). Free register for weekly newsletter: Please send your email to * Sponsor and advestising: T: (08) 3948 5574 - E:
  9. 9. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 9 CONSTRUCTION MATERIAL MARKET The prices of all types of construction materials have continuously decreased in the past several months, Both consumption and prices which has made the prices of this industry drop dramatically. Even some prices have fallen by 50% as go down compared to 6 - 7 months ago but the business situation has still been gloomy although the construction Edited by VietRees season has begun. The main reason is that the construction investors have still been seeking the capital supply, as a result, many construction works have not been started as in 2008. Currently, steel prices at the retail stores have been around 11 million VND/ton. The cement prices on the market have been quite stable with 68,000 - 70,000 VND/sack. However, the cement consumption of the factories has now slid by 30 - 40% over the same period last year. Some firms have organized the promotion programs with the form of offering more cement. The construction brick has also dropped to 450 - 600 VND/brick. Sand and stone of all kinds are still stable at the low prices as at the end of 2008. The construction material demand has now plummeted by 50% as compared to the construction season in 2008. The prices of construction material of all types have also decreased by 30 - 40%. The construction material prices have been lower than those in 2008, but they have still been 20 - 30% higher than in 2007. Although the construction season of this year has started slowly & rather gloomily, not a few construction material enterprises and producers have predicted that many construction works will be executed because the prices of all types of construction materials are low and many policies offering favorable loans are implemented from June onwards. However, the current supply has been quite plentiful, as a result, the shortages of goods and price fevers will not happen as in 2008. STOCK MARKET * At the opening time of the market, at the HCMC bourse, Two bourse continue to go down, launching the selling orders has still been the primary VN-Index lost 2.28 points, trend, which has made VN-Index lose 2.43 points. The HASTC-Index lost 1.07 points total trading volume has been over 1.1 million units. In the Edited by VietRees consecutive order-matching phase, VN-Index has lost an extra 0.82 points as compared to the first phase and Chart Source: Vietstock closed at 251.6 points. Ending the last session of the Up to date: 20 Feb, 2009 week, VN-Index has lost a total of 2.28 as compared to the previous one to close at 252.57 points. The total trading volume on the market has reached over 7.6 million units worth over 138 billion VND (equal to about 20% decrease in the volume and value as compared to yesterday’s session). After one trading week, VN-Index has had 5 downward sessions, losing a total of 21.94 points as compared to the last week (from 274.51 points down to 252.57 points). The trading volume on the whole bourse has averaged 8.6 million units per session. * At the Hanoi bourse, after the slightly increasing session yesterday, HASTC-Index has lost 1.07 points to close at 84.2 points. The total trading volume has reached nearly 3.4 million units worth 62.8 billion. After one trading week, HASTC-Index has only 1 upward session. As compared to the last week, HASTC-Index has lost 6.74 points (from 90.94 points to 84.2 points). Free register for weekly newsletter: Please send your email to * Sponsor and advestising: T: (08) 3948 5574 - E:
  10. 10. VietRees – Vietnam Real Estate Viet Nam Real Estate Newsletter A70 Page 10 REAL ESTATE MARKET FORECAST * Note: Information on market forecast is only updated every 4 periods (after one month) by VietRees – Feb, 2009 The situation of real estate transactions of apartments, town houses and project ground bases in General trends on the HCMC market January 2009 has continued to be gloomy although the prices have slightly decreased as compared to the previous months and some projects have even stopped reducing the prices. According to VietRees, the real estate prices in January have slightly declined because the bank interest rate has dropped and the construction materials prices have gradually become stable. The psychology of the market expects that the low interest rates will stimulate the individual investors to come back and this will somewhat impact on the prices listed on the market However, according to the analysis of VietRees, (1) Currently, most of the investors have lost the confidence in the stability of the market. (2) The prices of some apartment projects have still been very high. (3) Investors have been more experienced in assessing the projects and analyzing the market. (4) The market has had many choices and (5) been more careful in the transactions, as a result, surely, the prices will continue to decrease with the low amplitude in a short time. The supplies of the apartments belonging to the medium and low market segment have been fairly Apartment market limited, there is almost no new product and the market has seen almost no changes as compared to the previous month. Most of the successful transactions focus on the customers with the real needs not the investment purposes. The prices of the high-grade apartments has only fallen by 1%, however they have had relatively few customers, especially in the Lunar New Year people take little interest in buying the high-grade apartments in this stage. It is predicted that the prices of the high-grade apartments may continue to slightly decrease in the next few months. Although the prices of the ground bases have dropped, they have been so high to the people who have Project ground base market the real housing demand; so, the transactions are very few. If they have the real housing demand, they will choose to buy the apartments or town houses, not ground bases, therefore the transaction of ground bases has still been in dribs and drabs and even visibly stopped. Through the survey of the real estate business marketing agents in the past time, VietRees has realized Real estate agents that these agents has cut down on staff and the marketing budget substantially due to the sluggishness of the market. However, at present, according to the latest observations, some agents have actually become aware of the importance of the marketing and the stiff competitions in the market. As a result, in the near future they will focus on strengthening, streamlining the structure and continue to invest in training personnel, improving the customer service, marketing the brand image with the more focused, strategic and methodical plans than before. This is the praiseworthy sign of the market. According to VietRees, the agents that have a tight budget for marketing, they should focus on exploiting online media channels properly to reduce the costs and still reach efficiency as expected. They should not completely stop the activities marketing the brand images and products. This is the trend of the sectors in the current economy. Under the growing impacts of the financial crisis and economic recession, the real estate market in Forecast in 2009 Vietnam seems to be gloomier. VietRees has judged there is a faint possibility for the recovery of the market in 2009. In 2009 the market will have more difficulties than in 2008. Many real estate investors and speculators will cope with paying the bank debts but the property prices have seen no signs of recovery. According to VietRees, after Lunar New Year 2009, the real estate market will become an attractive playground for the investors with large capital and long-term investment strategies. The downward market will minimize the speculation situation and the market is in the hands of the buyers not the sellers as before. As a result, the potential real estate enterprises need to build long-term development strategies and positively work on the research and development, especially, seriously invest in the market research and research the customers; steadily develop step-by-step and avoid spreading the investment in this current difficult situation. The trend of switching to investing in the development of the cheap and common houses to attract the The coming investment trends majority of the customers is becoming more perceptible. Many enterprises are planning to promote their for Vietnamese real estate investment in the market segment. It is very promising that the people with the low & medium income will enterprises have many opportunities to get access to this supply. According to the studies of VietRees, the enterprises should invest in the apartments with the relative sizes of about 40 – 60 m2, good structure, relatively good materials and equipments (not need to be the high-grade ones) and the maximum selling price of 10 million VND/ m2. The apartment’s worth from 400,000 to 600,000 million VND/ unit will be able to attract more customers. The customers should be aimed at newly married couples, students, staff and civil servants who are living and working in HCMC. In fact, some foreign investors have been interested in this market segment. Therefore, the domestic investors should take quicker actions because according to VietRees, Vietnamese enterprises are likely to have more advantages than the foreigners in this market segment. VietRees, Feb 2009 Free register for weekly newsletter: Please send your email to * Sponsor and advestising: T: (08) 3948 5574 - E: