Why Vietnam residential transactions are expected to rise in the short term
The office sector, meanwhile, is slowly recovering.
According to a Colliers report, the office market in Vietnam has been showing signs of a recovery since the beginning of 2022 with demand largely driven by businesses expanding their operations and new overseas entrants.
Here’s more from Colliers:
In August, nearly 12,000 new businesses registered to begin operations in the country and nearly 6,500 enterprises resumed operations.
Two projects in Ho Chi Minh City’s District 3 and District 7 added 32,000 sq m of office space to total supply in the segment.
According to Trading Economics, international arrivals to Vietnam jumped by 5,130.7% YOY to 486,400 in August, helping the serviced apartments and hospitality sectors rebound strongly.
In the short term, apartment prices will continue to increase due to rising costs of land and construction. And with the central bank recently announcing its intent to ease lending and borrowing rules, we expect both investors and buyers to capitalise on the opportunity, which should ramp up the number of transactions in the residential sector.
In the office segment, we expect owners of office projects to adjust their offerings and services to serve the growing demand for flexibility in leases and the ability to serve a globally distributed workforce.
Given the extreme scarcity of Grade A office supply in the CBD area of Ho Chi Minh City due to a lack of available land, we advise investors to consider developing new projects in the city of Thu Duc.