Business News

The real estate sector ranked second in the list of industries attracting FDI in 2022, with more than US$4.45 billion, accounting for 16.1% of total registered investment capital. According to the Foreign Investment Agency, Ministry of Planning and Investment, in the past year, foreign investors poured funds into 19 industries out of a total of 21 national economic sectors.

The real estate market is falling short of funding when banks and corporate bonds are simultaneously tightened, leaving companies unable to respond to sudden changes that result in a halt to a lot of projects. Clearing this "bottleneck" is a big concern of authorities, investors and people because this is a key market that plays an important role in attracting resources and developing many other industries and fields.

According to the Ministry of Planning and Investment, foreign direct investment (FDI) last year reached its highest level in the past five years at $22.4 billion, up 13.5 per cent over the previous year. Among those, real estate took the second-highest position with 16 per cent.

According to data from batdongsan.com, the investor sentiment index for the start of 2023 is 36 points, a significant decrease from 47 and 40 points in the first and second halves of 2022, respectively. The category in which real estate purchasers' and sellers' enthusiasm decreased the most was real estate loan interest rates.

After a lengthy period of inactivity, the real estate market in and around Ho Chi Minh City is resuming deals, mostly in new full-scale developments. Property prices in the central district of Ho Chi Minh City have risen to such an extent that many young people are choosing to purchase homes in the suburbs, where costs are more affordable.

Minister Nguyễn Hồng Diên said the sector had made significant progress despite numerous difficulties and challenges including complicated geo-political developments around the world, rising trade protectionism, disrupted supply chains in the aftermath of a global pandemic and tightened monetary policies by major central banks.

To meet investment attraction and industrial development needs, on February 23, 2021, the Prime Minister issued Official Dispatch 216/TTg-CN to ratify the revised industrial park development plan for Bac Giang province. According to the revised plan, the province can add three industrial zones and expand three industrial zones in Yen Dung, Luc Nam, Lang Giang, Viet Yen and Hiep Hoa districts, with a total area of 1,155 ha. This decision is very important to increase the industrial land fund for more investors seeking to invest in the locality and boost socioeconomic development.

The industrial real estate sector has also been attracting new supply sources. On November 12, investment was approved for developing infrastructure at Hai Long IP in the northern province of Thai Binh. Covering an area of 297ha, the project is funded by Bao Minh IP Infrastructure Investment JSC with total capital of VND2 trillion ($87 million).