VIETNAM

VIETNAM RESIDENTIAL
MARKET
Investment Guide 2019
1. Market Outlook
2. Legal updates
3. Infrastructure
4. Investment Opportunity

1
1. MARKET OUTLOOK

2 2
VIETNAM AT A GLANCE

97
HANOI (CAPITAL) POPULATION
Mil.
Area: 3359 km2
Population: 7.3 mil

High
Limited price
WORKING
supply growth 70% POPULATION
4,423 units US$1,764 (15-64 yrs. old)
▼54% y-o-y ▲15% y-o-y
DANANG
Area: 1285 km2
Population: 1 mil

GDP GROWTH
6.8%
RATE

HO CHI MINH CITY

Area: 2061 km2
2.2% UNEMPLOYMENT
Population: 8.3 mil
RATE
Source: General Statistics Office, 2017.
3
HCMC MAP

High
Limited price
supply growth
4,423 units US$1,764
▼54% y-o-y ▲15% y-o-y

4
 HCMC CONDOMINIUM

Q 1 2 0 1 9 M A R K E T S N A P S H OT
4,423 units launched from 12 projects

Luxury High-end Mid-end Affordable

1 project 4 projects 6 projects 1 projects
TEXT
205 units 1,292 units 2,446 units 480 units
New launch No unit launched in ▼ 55% y-o-y ▼ 64% y-o-y No unit launched in
Q1 2018 Q1 2018

5,859 US$/sm 2,318 US$/sm 1,174 US$/sm 792 US$/sm

▲ 12% y-o-y ▲ 5.2% y-o-y ▲ 2.8% y-o-y ▲ 1.5% y-o-y
Selling Price (*)

240 units 1,397 units 3,733 units 554 units

▲ 5x y-o-y ▼ 53% y-o-y ▼ 41% y-o-y ▲ 66% y-o-y

Sold units
(*) Selling price excludes VAT and quotes on NSA
Source: CBRE Vietnam Q1 2019. 5
HCMC CONDOMINIUM

FOREIGN BUYERS
Increasing demand
Buyers by Purpose, Based on CBRE transactions Rental yield in key SEA cities

End user Buy-to-gain Buy-to-let

7%
6%
6%
5% 5%

14% 20% 66%

Source: CBRE transactions only, this number does not represent for the whole market.
2% 2%

Number of transactions by foreign

buyers at CBRE in 2018:
▲ 200% y-o-y Jakarta Manila Bangkok Hanoi HCMC Singapore Phnom
Penh

Source: CBRE research, Q4 2018.

6
HCMC CONDOMINIUM

M A R K E T O U T LO O K
2019 Supply Dominated by the East
2018 NEW LAUNCH SUPPLY 2019 NEW LAUNCH SUPPLY

1% 1%

29% 61%
8%
7% 7%
9%

53% 23%

7
HCMC CONDOMINIUM

M A R K E T O U T LO O K
Price Increase, Sales Performance Maintain Strong

Forecast on New launch and Sold units Forecast on Primary Price

Forecast 7,000 Forecast
45,000 New launch supply
Sold units
Future new launch supply (US$

40,000 6,000

Primary price (US$ psm)

35,000
5,000
30,000
25,000 4,000
psm)

20,000 3,000
15,000
2,000
10,000
5,000 1,000
-
2016 2017 2018 2019F 2020F 2021F 0
2016 2017 2018 2019F 2020F 2021F
Luxury High-end Mid-end Affordable
Luxury High-end Mid-end Affordable

Source: CBRE Vietnam Q1 2019. 8

2. LEGAL UPDATES

9 9
HCMC CONDOMINIUM

2015 NEW HOUSING LAW

Relaxation of foreign ownership

50+ years, ALLOWED years,

01+ Extendable subject to Foreigners are allowed to
AFTER Foreigners who are lease, contribute as capital,
Unlimited applicable laws
allowed to enter Vietnam
codons High
(indefinite term for foreigners
married to Vietnamese citizens)
gift, bequest, exchange,
etc…
Limited price
supply HOW growth HOW WHAT
WHO 4,423 units MANY LONG
US$1,764 FOR
▼54% y-o-y ▲15% y-o-y

A foreigner, subject No sub-lease

01 50
to certain criteria One condo Years, no
BEFORE and working in extension
Vietnam for at least
one year

10
PROPERTY OWNERSHIP
TIMELINE IN VIETNAM

2. Inward Remittances(*) 4. Ownership of Properties 6. Extension of Property Ownership 8. Outward Remittances(*)

• Documentation to • Max 50 years term of ownership; • Before the expiry of 03 months • The purpose of transfer is required
support the source of or property ownership
funds or the purpose of
• Supporting documents required:
• The same term as Vietnamese • One time extension • Purchasing Contract
transfer may be
citizen (if married to either a
High
(not more than 50 years) • Property Ownership
required
Limited
local or overseas Vietnamese price • Other relevant documents
supply growth
Inward4,423 units Property PropertyUS$1,764 Ownership Sale/Lease of Outward
Account Opening ▼54% y-o-y Purchase ▲15% y-o-y
LURC
Transfer Ownership Extension Properties Transfer

3. Purchase of Properties 5. LURC 7. Sale/Lease of Properties

1. Open a Bank Account
• Physical presence at the
branch in Vietnam
• Passport (notarized and
translated into
Vietnamese)
• Payment must be made through a • A certificate for land use rights • Lease for any purpose not banned by law
and ownership of the house,
licensed credit institution (a Bank) in VN
condo, etc on the land • Must inform the provincial house
• Types of Properties: (together, “LURC”) can be management agency prior to leasing
▪ Houses obtained
▪ Villas Source: Standard Chartered, 2016.

▪ Condominiums 11
TAXES AND FEES

BUYING THE PROPERTY SELLING THE PROPERTY RENTING THE PROPERTY

Value added tax (VAT)
• 10% VAT based on transfer price of house
• No VAT for transfer of land use right
Sinking fund : 2% Limited
supply
Registration fee (stamp duty)
• Payable when buyers received their
4,423 units
Certificated of Ownership ▼54%
(0.5%)y-o-y
• Registration fee = Price for registration
fee calculation issued by Provincial
People’s Committee*
• Maximum fee is VND 500
million/asset/transaction
Personal income tax (PIT)
High
• 2% on transaction value
VAT
price
• Individual not carrying out
growth
registered business activities are
not required to declare and pay VAT
US$1,764
when selling assets.
▲15% y-o-y
• Unclear if a property is purchased
for leasing purpose, when selling it,
would VAT be applicable. Not seen
in practice
• Agent fee : 2% - 3% on transaction
value
Vietnam tax residents
Business license tax
• VND 1 million (~USD $45) per year for
rental income is equal or more than
VAT
VND 1,500,000/month (~USD $75)
• Not applied if rental income is or less
than VND 100 million/year
• VAT = total rental income +5%
PIT
• Not applied if rental income is or less
than VND 100 million/year
• PIT = total rental income +5%

Non – Inherited tax Non – Vietnam tax residents

No clear specific rules and regulations
May likely be taxed like a resident
Source: KPMG
individual lessor.

12
THE DIFFERENCE BETWEEN THE
TWO AGREEMENTS

CONTENT SALE PURCHASING AGREEMENT (SPA) LONG TERM LEASE AGREEMENT (LTLA)
Buyers who do not fall within the housing quota for
Buyers who fall within the housing quota for foreign foreign buyers (i.e 30% of total units) can only receive
WHO GETS WHAT? buyers (i.e 30% of total units) can receive SPA. LTLA.
DOES THE BUYER GET A No. The buyer cannot receive any certificate of
CERTIFICATE OF Yes. The buyer will receive a certificate of ownership, ownership as they are considered as a lessee/tenant to
OWNERSHIP? also known as a Pink Book. the property.
50 years from issuance of Pink Book High 50 years from when the developer's business license is
HOW LONG IS IT VALID Extendable (applied in advance of 3 months in prior to approved.
FOR? Limited
the Expiry date) price Can be renewed, but dependent on developer.

IS THE BUYER ELIGIBLE? Thesupply

buyer MUST show proof of entrygrowth
to Vietnam
4,423 units US$1,764
▼54% y-o-y ▲15% y-o-y
Yes. The buyer can resell the property but it is
Yes. The buyer can resell the property via the dependent on developer. This transaction is also done
CAN THE BUYER RESELL notarization office where a small assignment tax is via notarization office where a small assignment tax is
THE PROPERTY? paid. paid.
CAN THE BUYER RESELL
Yes. Local buyers can get freehold
TO LOCAL?
CAN THE BUYER LEASE
OUT THE PROPERTY? Yes. Can lease out to tenants. Can sub-lease if the lessor agrees
The resales price will be the same Market's local resales
ADVANTAGES local price

Can resell to foreigner anytime depends on the lessor

DISADVANTAGES The price will be higher than local LTLA usually valid for less than 50 years 13
ESTIMATED PAYMENT SCHEDULE

NO INSTALLMENT % OF SELLING
TIMING
. S PRICE
1 Deposit Jan-18 10% + VAT
1. Client chooses unit, places deposits and signs deposit slip. When Deposit Agreement
and Sales & Purchasing
2. First installment is expected within 7-14 working days of deposit. 2 Installment 1 15% + VAT
Agreement are signed by
Client signs DA (Deposit Agreement) after first installment and is the purchaser
NOT REQUIRED to be in Vietnam for signing.
4 months after Installment 1
3. Client then signs SPA (Sales and Purchase Agreement)/LTLA (Long
High3 Installment 2
due date
5% + VAT

Term Lease Agreement) whenLimited price

project’s foundation is completed, 4 Installment 3
4 months after Installment 2
5% + VAT
paid maximum 30% and is REQUIRED to be in Vietnam for due date
signing (with SPA). supply growth 4 months after Installment 3
4,423 units 5 Installment 4 5% + VAT
US$1,764 due date
▼54% y-o-y ▲15% y-o-y
3. Subsequent installments depend on developer. See example of 4 months after Installment 4
payment schedule on the right. But pay no more than 50% before 6 Installment 5 5% + VAT
due date
complement with foreigner developers and 70% with local
4 months after Installment 5
developers. 7 Installment 6 5% + VAT
due date
4. Client REQUIRED to be in Vietnam at Handover Date, and On the Apartment 45% + VAT + 2%
8 Installment 7
receives Pink Book. Handover Date (TBC) Maintenance Fee
Upon issuance of
9 Installment 8 5% + VAT
Ownership Certificate
100% + VAT +2%
Total
Maintenance Fee

14
WHEN CAN THE BUYER RESELL?

1. When project is UNDER 2. When project is UNDER 3. When project is 4. When project has the
FOUNDATION: CONSTRUCTION: foundation HANDOVER and APPLYING PINK BOOK:
• Client sign Deposit Agreement completed FOR PINK BOOK: • Client can Resell
• Client cannot resell unit • Client sign Sales & Purchasing • Client cannot Resell
Agreement High
Limited • Client can Resell
price
supply growth Project
Project Under 4,423 unitsProject Under US$1,764 Certificate of
Foundation Construction Handover ownership
▼54% y-o-y ▲15% y-o-y

15
3. INFRASTRUCTURE

16 16
R E A L E S TAT E M A R K E T

M A J O R P R O J E C T S TO C O N N E C T T H E E A S T

Infrastructure
• Metro line no.1 and 2
• HCMC – Long Thanh – Dau Giay express
way
• Le Loi boulevard
HCMC – Long Thanh – Dau Giay • Thu Thiem Tunnel was completed
1 • Bridges:
✓ Thu Thiem bridge no.1
✓ Thu Thiem bridge no.2
✓ Thu Thiem bridge no.3
• Slower grow in new launch ✓ Thu Thiem bridge no.4
✓ Cat Lai Bridge
allowing market
2 to adjust the
✓ District 9 Bridge
product to meet buyer • Long Thanh International airport
demand. • River road connected from VHCP to
Centennial
• There will be more supply in
mid-end market
• Developers from Hanoi
account for over 40% of new
supply. Metro line no.1 1717
R E A L E S TAT E M A R K E T
IN THE EAST

METRO LINES SYSTEM

Metro Route Length
Line
THANH XUAN

Ben Thanh – Suoi Tien

HIEP BINH PHUOC
SUOI TIEN
1 19.7 km
4 Completion expected 2020
AN SUONG
1
3
2 2 An Suong – Cat Lai 11.3 km

BA QUEO

SAI GON BRIDGE

BEN THANH HUB 3 Tan Kien – Hiep Binh Phuoc 31.9km
• Slower grow in6 new launch 2

allowing market to adjust the

4 Nguyen Van Linh – Thanh Xuan 41.2 km
product to meet buyer
PHU LAM
CAT LAI

demand. 3 5
Saigon Bridge – Can Giuoc
• There will be more supply in NGUYEN VAN LINH
5
Coach Station
23.4 km
mid-end market
TAN KIEN

• Developers from Hanoi

CAN GIUOC
Under Construction Metro Lines
6 Ba Queo – Phu Lam Intersection 6.4 km
account for over 40% of new Under Planning Metro Lines

supply. Scale: 2 km
18
Source: CBRE Vietnam.
 New Mien Dong Bus Station after 2 years of
construction
After two times delaying the project, the 4,000-billion-VND bus station of HCMC
has been on good construction progress and expected to launch by September 2nd
this year.

19
OneHub Saigon (P.1) – District 9 CII Building – Binh Thanh
R E A L E S TAT E M A R K E T

THU THIEM – NEW CBD

Relocation of Launch of the first Cove Residence,

Planning for Thu Thu Thiem 1 Thu Thiem Work on Thu Thiem
existing residents residential project Metropole
Thiem begins Bridge opened Tunnel opened 2 Bridge begins
officially begins by Dai Quang Minh launched

1996 2002 2008 2011 2015 2015 2018

2020
R E A L E S TAT E M A R K E T

T R A D I T I O N A L I N T E R N AT I O N A L S C H O O L S C L U S T E R
A N D R I S I N G R E TA I L M A R K E T
International school

63% of total number of

IS are in District 1 and 2

• Slower grow in new launch Retail

allowing market to adjust the
product to meet buyer
demand. Majority of big shopping
• There will be more supply in malls are in District 1
mid-end market and 2
• Developers from Hanoi
account for over 40% of new
supply. 21
R E A L E S TAT E M A R K E T

SAIGON HI-TECH PARK

Saigon Hi-Tech Park (SHTP) is a park for

high technology enterprises located 15 km
from downtown Ho Chi Minh City, opposite to
Thu Duc University Village, along the Ha Noi
Highway and on the future Metro line 1
Several world leading high-tech companies
chose SHTP:
• Samsung CE Complex (SECC) ($1,4 billion)
• Intel ($1 billion)
• Nidec ($1 billion)
• Air Liquide
• Sanofi (France) ($75 million)
• Schneider Electric (France) ($45 million)

2222
4. INVESTMENT OPPORTUNITY

23 23
R E A L E S TAT E M A R K E T
IN THE EAST

REAL ESTATE DEMANDS

Capital Gain

• Slower grow in new launch

Real estate
allowing market to adjust the demands
product to meet buyer
demand.
• There will be more supply in
mid-end market End-user Buy-to-let
• Developers from Hanoi
account for over 40% of new
supply. 24
STEPS IN CHOOSING REAL
E S TAT E P R O D U C T S

END-USER
Desired location
Choosing suitable projects
Developer’s reputation
Facilities and amenities

Management team

Legal
documents Contracts term and related
of the conditions
projects

Handover condition

Specific unit features Budget and loan packages

25
STEPS IN CHOOSING REAL
E S TAT E P R O D U C T S

BUY-TO-GAIN

Market research
Choosing potential locations

Building relationship
and network with
agents

Investment horizon and

Project potential expected return
and developer
capability

Budgeting and suitable

financial supports

Choosing suitable products

Legal documents of the (price, design, unit size, unit
projects type,…)

26
STEPS IN CHOOSING REAL
E S TAT E P R O D U C T S

BUY-TO-LET
Market research
Choosing potential
locations

Considering suitable
leasing methods

Budgeting Aware of potential risks

Calculation of
expected return

Suitable products to meet

Looking for supporting
tenant demand
loans package from
multiple source

27
R E A L E S TAT E M A R K E T
IN THE EAST

AVAILABLE STOCK WITH HIGH POTENTIAL

Launched supply
1960s
Future supply US$3,500
▲ 11%
US$3,900
▲ 11%
US$2,900
▲ 20% US$2,300
US$3,350 - 2,600
▲ 11%
US$2,900
US$2,500 ▲ 31%
▲ 56% US$ 2,900
▲ 25%

US$2,530
▲ 19%

US$ 3,100
US$3,300
- 3,300 US$ 3,300 -
US$ 6,000 – ▲ 26%
3,800
8,000 US$ 3,100 - 3,300

2019
US$ 8,000 US$ 3,000 - 3,200
US$9,600 14,000
US$4,600 US$3,450
US$10,000
US$2,900
– 3,800
US$3,100
– 3,800 US$3,500

US$4,100
▲36%

US$5,000
US$6,800

US$9,500 – US$7,500
10,500 28
US$5,800
DISTRICT 1 - CBD

29
 CHILE EMBASSY

CAMBODIA EMBASSY
U.K EMBASSY

GERMANY EMBASSY
CHINA EMBASSY
U.S EMBASSY
FRANCE EMBASSY
RUSSIA EMBASSY
AUSTRALIA EMBASSY
JAPAN EMBASSY
CANADA EMBASSY

BEN THANH MARKET

SINGAPORE EMBASSY

30
RECOMMENDED PROJECTS

GRAND MANHATTAN
Developer Nova Land
39 floors + 4 basements:
1-2nd floor: boutique shophouses
3rd floor: hotel’s facilities
Type 4-6th floor: 217 hotel units
7th floor: residents’ facilities
8-38th floor: condo
39th floor: penthouse. High
Total Unit 1,027Limited price
No. of available
units
supply
As requested by purchasers growth
4,423 units US$1,764
▼54% y-o-y ▲15% y-o-y
Location Nguyen Huu Canh, District 1, Ho Chi Minh City, Vietnam
Unit Size 2BR: 68 – 81 sqm 3BR: 89 – 90 sqm
Year Completed Q1/2022
Status Under construction.
Cinema, lounge, gym, yoga, swimming pool, restaurants,
Facilities
concierge desk…
Asking price US$ 6.500 – 7.000/sqm excl. VAT
Expected yield 4-5%
Management fee ~0.8 USD/sqm (excl. VAT)
31
Brochure THE GRAND MANHATTAN
District 2

32
RECOMMENDED PROJECTS

New City Thu Thiem

Developer Thuan Viet
Type 4 condo towers (39-40 floors)
Total Unit 1,328 units

Location High
17 Mai Chi Tho street, Bình Khánh ward, District 2, Ho Chi
Minh City, Vietnam
Limited price
1BR: 46 – 50 sqm 2BR: 62 – 80 sqm
Unit Size
supply
3BR: 101 – 103 sqm
growth
4,423 units US$1,764
▼54% y-o-y ▲15% y-o-y

Year Completed Already Handed Over

Status Only Have 3BR left
Gym, resort style pools, shopping mall, coffee shop,
Facilities
kindergarten…
Asking price US$: 3,404/sqm Incl. VAT
Expected yield 6% - 6.5%
Management fee $0.7 per sqm
Brochure NEW CITY THU THIEM
33
NARRA RESIDENCE
Developer Keppel Land, Gaw Capital Partners, Tien Phuoc and Tran Thai
86-storey building, a five-star hotel, a shopping
Type
mall, office buildings, high-end apartments MU11 – The River Front
Total unit Phase 4: 350 units
Status of project Ready to be launched in July 2019
Functional Area 2 (Area 2B) Thu Thiem New Urban Township,
Location
Thu Thiem Ward, D.2, HCMC
Unit Size From 60 - 228 sqm
Year Completed 2022
Status Refundable booking
Swimming pool, gym, BBQ, clubhouse, tennis, volleyball
Facilities
court, shopping center
Asking price US$ 6,000 - $ 6,500/sqm (fully fitted)
Expected yield 7-7.5% (expect)
EMPIRE CITY
Management fee ~1- 1.8 USD/sqm
Brochure NARRA RESIDENCE 34
RECOMMENDED PROJECTS

Rome – Diamond Lotus

Developer Phuc Khang Corporation
Type Condominium
Total Unit Around 700 units
No. of available
units

Location
High
Corner of Dong Van Cong and Mai Chi Tho, An Phu Ward,
Limited
District 2, Ho Chi Minh City, Vietnam
price
1BR: 51sqm 2BR: 65 - 70sqm
supply growth
Unit Size 3BR: 102
4,423– units
107 sqm US$1,764
▼54% y-o-y ▲15% y-o-y

Year Completed 2021

Status Under Construction

Facilities Gym, resort style pools, coffee shop, …

Asking price US$: 3,300 – 3,700/sqm Excl VAT

Expected yield 5% - 6%
Management fee TBC
Brochure ROME - DIAMOND LOTUS
35
R E A L E S TAT E M A R K E T

WHY THE EAST OF HCMC?

Pudong - Then Pudong - Now

Thu Thiem
The new CBD of HCMC

36
 DISTRICT 7
Korean & Taiwanese Community

37
RECOMMENDED PROJECTS

THE INFINITY
Developer Keppel Land + Tan Truong
Type 4 condo towers (39-40 floors) + 1 basement
Total Unit 801 units
No. of available
Receive refundable booking 50 mill VND (~$2200)
units

Location
High
584 Huynh Tan Phat, Tan Phu Ward, District 7, Ho Chi Minh
Limited
City, Vietnam
price
1BR: 54 – 58 sqm 2BR: 79 – 106 sqm
supply growth
Unit Size 3BR: 121
4,423– units
145 sqm Duplex 3BR: 150 – 167 sqm
US$1,764
▼54% y-o-y ▲15% y-o-y
Duplex 4BR:176 – 177 sqm
Year Completed Q4/2021
Status Under construction
Water fall, Beach pool, Sun loungers, Tree house –
Facilities
Camping Zone, Adventure Climbing Net,…
Asking price $2,800/sqm
Expected yield 5%
Management fee TBC
Brochure THE INFINITY
38
 THANK YOU
For more information regarding this presentation please contact:

Ms.Huynh Vo (Heidi) | Senior Sales Executive

CBRE Vietnam | Residential Project Marketing
13th Floor, A&B Tower, 76A Le Lai, Ben Thanh Ward, District 1, Ho Chi Minh
City, Vietnam
M +84 933 97 21 97(WhatsApp / Viber)
Huynh.vothinhu@cbre.com| www.cbrevietnam.com | www.cbre.com
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