Property

At the third session of the 15th National Assembly (NA) on June 8, Minister of Construction Nguyen Thanh Nghi identified nine problems and inadequacies in the country’s real estate market and proposed a range of solutions to develop the market stably, efficiently, and sustainably, such as perfecting the legal system, restructuring real estate credit, strictly controlling the issuance of corporate bonds in real estate, and boosting the transparency of information on housing and real estate.

The expansion of Hanoi and Ho Chi Minh City along with the implementation of key transport projects are creating opportunities for investors to develop mega-urban projects. According to the Vietnam Association of Realtors (VARS), urban projects with areas of 100 ha or more in districts far from the city center are the main source of supply for the real estate market.

The construction sector is working to increase the average housing area to 25.5 sq m per person this year and for the national urbanization rate to reach 41.5-42 per cent. In order to achieve these goals, the Ministry of Construction (MoC) has called for the revocation of public projects that are not really necessary and are ineffective, and for the scattered nature of investment to be addressed.

The No Va Real Estate Investment Group Joint Stock Company (Novaland), a member of the NovaGroup, has received a $250 million investment from Warburg Pincus. Warburg Pincus is the largest and most active private equity fund in Vietnam, with total disbursed and committed capital of more than $1.5 billion since 2013.

Analysts told the “Removing obstacles and promoting investment in the real estate sector” seminar on May 27 that it is necessary to quickly remove bottlenecks in the market so that it will not affect other markets. Real estate currently accounts for 25 per cent of GDP and involves at least 40 industries.

To improve the quality of FDI attraction, the Ministry of Planning and Investment (MPI) has asked cities and provinces to review and evaluate the implementation of certain FDI projects. These include projects with registered investment of over $100 million; those with a land area of over 50 hectares; and those in the field of real estate in Hanoi, Ho Chi Minh City, Da Nang, Hai Phong, Khanh Hoa, and Ba Ria-Vung Tau that have a land area of over 2 hectares.