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During a recent seminar hosted by The Investor, Nguyen Anh Tuan, the deputy director of the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment, highlighted the swift influx of international investors into Vietnam’s real estate market.
According to the report, Vietnam’s real estate sector ranks as the second most appealing industry for foreign investment, closely following the manufacturing and processing sector. So far, the country has successfully attracted more than 37,500 projects, with a combined investment of nearly $450 billion. Among these projects, there have been 1,100 investments in the real estate sector, totalling $66.4 billion, which accounts for 15 percent of the overall foreign investment in the country.
Tuan pointed out that Vietnam’s property market has attracted investments from 48 different countries and territories, with significant contributions from investors based in Singapore, South Korea, the British Virgin Islands, and Japan. Among the 45 provinces and cities that received foreign direct investment (FDI) in real estate, Ho Chi Minh City takes the lead, securing over $16 billion in registered capital, which represents 24.7 percent of the total investment. Following closely are Hanoi, Binh Duong, and Ba Ria-Vung Tau.
According to the report, foreign firms investing in Vietnam’s real estate sector are predominantly large-scale entities, and their projects showcase a diverse range of investment opportunities and varying levels of quality
Numerous foreign direct investment (FDI) ventures are making significant investments in Vietnam, totalling billions of dollars, which include projects like Ho Tram in Ba Ria-Vung Tau, the smart city in Hanoi, and the Nam Thang Long Urban Area in Hanoi, among others.
Vietnam’s attractiveness to foreign investors stems from a combination of factors, such as its political stability, impressive economic growth, competitive manufacturing costs, an abundant labour force, potential market opportunities, and a strategically advantageous geographic location that allows for connections to large economies.
In addition to these factors, Vietnam’s extensive coastline provides excellent opportunities for the development of resort properties, complemented by a well-developed infrastructure system that has benefited from substantial investment.
In spite of the mentioned advantages, foreign-funded real estate projects in Vietnam face challenges related to inefficiency. Certain large-scale land projects experience delays in implementation, while the complex administrative procedures involving investment, construction, bidding, and land use often result in prolonged project execution. Notably, the legal framework governing the real estate market is perceived as lacking coherence, clarity, and adaptability to changes.
As reported, the Ministry of Construction has taken the initiative to draft amendments to the Housing Law and the Real Estate Business Law. Furthermore, the Vietnam Real Estate Brokers Association has urged for swift adjustments in foreign investment policies to remain aligned with global economic fluctuations and changes in other countries’ FDI strategies.
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