Foreigners hunt for high-end apartments in HCM City

Nguyen Duc Tai, a real estate broker, said two Koreans wanted him to find apartments in district 2 for them, but it was difficult because of the ceiling limit.

Under current regulations, the number of apartments sold to foreigners in a project must not be higher than 30% of the total. 

“The two Koreans later had to lease apartments for 1-2 years and wait for opportunities to buy an apartment,” he said.

Tai, who has been a broker for five years, said foreigners prefer high-end apartments in Thao Dien Ward, Districts 2 and 7. Korean expats favor the projects in district 7, where a Korean community has taken shape.

In general, Korean choose high-end projects with fewer than 500 apartments, because they don’t like the projects with a high density of people.

However, Tai said, in many cases, room for foreigners has run out not because they have been sold to speculators, not to many foreigners.

“Many speculators make fat profits when selling apartments to foreigners at the beginning of every year, when foreigners come to Vietnam to start their work”.

The representative of a large real estate firm in Ho Chi Minh City confirmed that 100 apartments at the firm’s project in district 7 have been sold to expats from Hong Kong.

He said the demand from Hong Kong people is high.

“The real estate price in Vietnam is much more ‘reasonable’ than in Hong Kong. That is why houses and apartments in Vietnam are favored by Hong Kong people,” he explained.

Savills Vietnam also commented that Vietnam is an ideal destination for buyers from Taiwan, Hong Kong and the Republic of Korea, because the price here is much lower than in their home markets.

According to Nguyen Khanh Duy from Savills, a high-end apartment in the central area of the city can be bought at VND115.3 million per square meter, or approximately US$5,000. In Hong Kong, buyers would have to pay four times higher for similar products.

Foreigners like to buy houses in Vietnam also because the ROI (return on investment) is attractive. Since the high-end apartment supply is not plentiful, the market segment has high liquidity.