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Positive outlook for Vietnam

4th February 2015

The Vietnamese economic outlook remains positive largely due to the country’s ongoing macroeconomic stability and the continued strong performance of the foreign-invested manufacturing export sector. This is according to CBRE’s 2014 quarterly report.

The government has taken some important measures in recent years to improve business conditions, which is expected to bear fruit from 2015. The performance of property sectors has seen improvements, especially in the residential sector. “Stalled building projects have restarted and construction progress has accelerated thanks to cheaper and more readily available funding. In 2014, the real estate market ranked second in terms of total FDI into Vietnam, accounting for 12.6% of the total,” says CBRE.

Decreasing interest rates, improving market confidence and favourable changes in Housing Law have supported the recovery of the residential market in 2014. The last quarter of the year witnessed some significant developments beginning construction and launching to the market. These included Vinhomes Central Park (1,100 units launched in Q4 out of a total stock of 10,000 units) in Binh Thanh District, Masteri Thao Dien (1,449 units launched in Q4 out of a total stock of 3,012 units) in District 2 and Scenic Valley (Block D2 and E1, 270 units) in District 7. The review quarter recorded 6,760 units launched, increasing by 117.8% q-o-q and 150.2% y-o-y. Progress in Q4 sent the total number of launches in 2014 to 14,807 units, 3.2 times higher than in 2013.

The high-end segment showed a notable turnaround in the review quarter with a high absorption rate, especially at newly launched projects. Scenic Valley recorded 100% sales on the launching date while the sales rate at Masteri Thao Dien quickly reached approximately 85% out of 1,449 units within two months. Thanks to a good sales rate at recently launched projects, the sales rate of the high-end segment in 2014 reached approximately 60%.