Wealthy Vietnamese pouring money into overseas properties
Wealthy Vietnamese are rushing to buy properties overseas for many purposes – for eventual settlement, overseas study and investment.
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Pham Thanh Hung, vice president of Cengroup, said selling properties worth VND1 billion in Vietnam is common, but selling real estate overseas is another story. The consultancy and brokerage fee for every affair is very high.
“I have been in the trade for years, and making such deals can bring excitement,” he said.
Hung said this type of business is attractive because of the demand created by the emigration wave and the high commissions, but it is difficult because of complicated legal procedures. Thus, there are not many real estate brokerage firms that provide the service. Cengroup is one of 5-6 service providers.
Vietnam is one of the 10 countries with the highest emigration rates in Asia-Pacific, about 100,000 people each year. IOM estimates that in 1990-2015, over 2.55 million Vietnamese migrated abroad.
A report showed that in the last five years, the Ministry of Justice reported to the State President about 40,000 cases of resumption and relinquishment of Vietnamese nationality.
The majority of Vietnamese left for developed countries such as the US, Singapore, South Korea, Germany, France, Australia and Canada. It is estimated that 1.3 million people left for the US, while about 100,000 left for other countries.
However, despite the high migration rate, Hung doesn’t think the buying of properties overseas will see a boom, because the government doesn’t allow transfer of money abroad to make payment for house purchases. Vietnamese people only can buy houses overseas if they can prove their income is ‘clean’.
Those who want to buy real estate overseas tend to do this under the CBI (Citizenship by Investment) programs used by some countries.
When Vietnamese spend between 300,000 euros and 2 million euros to buy properties or invest in projects with CBI programs, they have opportunities for eventual settlement and foreign citizenship.
According to Coldwell Banker Singapore, property purchases by Vietnamese account for 3.2% of real estate transactions in Singapore.
Meanwhile, Hung said the number of Vietnamese buying houses overseas is far higher than the number of foreigners buying houses in Vietnam. He believes the figure is 1,000 people per annum. In most cases, Vietnamese buy properties to obtain PR (permanent resident) status.