What are your insights on the potential for Foreign Direct Investment (FDI) inflows into Vietnam’s real estate market from Singaporean investors?

I was in Vietnam 20 years ago, this is after this long period of time that I come back to Vietnam and Hanoi, I see there is a huge difference. As for the investment coming from Singapore, definitely there is a huge improvement and also a huge interest. Recently there’s a visit by the Singapore Prime Minister to Vietnam in August last year. The Singapore side has actually signed with the Vietnamese side to develop 4 new Vietnam Singapore Industrial Park (VSIP) in Vietnam. That shows that Vietnam is really a key destination for Singapore’s foreign direct investment

What do you think about the Vietnamese Government’s efforts and policies in attracting FDI from Singapore?

I will go back to the recent visit by the Prime Minister of Singapore and we have been establishing a strategic partnership for decades, maybe 10 years or even 15 years of the relationship between Vietnam’s government and Singapore government. And I think Singapore has actually welcome the advancement of Vietnam in the sense and we have gained more confidence and over the past 20 years we can see that there are lots of improvement and currently Singapore has 13 VSIPs in Vietnam and looking for more. So I guess definitely the Vietnamese government has done a great economic plan for investors not just in Singapore but for other countries as well.

What do you think about the performance of Vietnam’s real estate market in 2023?

The interest for Vietnam has picked up recently in Singapore because of Singapore’s tight control and purchasing a property even for our citizens. In April last year, Singapore announced foreigners who buy Singapore property to put up 60 per cent upfront costs in turn of tax and even for our own local citizens, they have to pay 20 per cent more for second property and 30 per cent more for third or more property. That puts out a lot of upfront costs into the investment at a property back in Singapore. So Singaporeans are actually looking to invest overseas generally. And what they’re looking at is that country that can offer them good returns in terms of capital gain, and also rental income return. Generally, my opinion is that the Singaporean will still be very interested in the Vietnam market.

How would you assess the investment landscape in Vietnam for both foreign and Singaporean investors?

Investment environment in Vietnam I think is fantastic. Let’s talk about transportation, especially international transportation, there are more direct links even more direct flights to Ho Chi Minh and to Hanoi and the strong development of tourist areas such as Da Nang, etc. That’s why I said that Vietnam improved a lot in transportations and one thing I observe the difference for the last 15 years was the road is much, much wider, and there are more highways and expressways. And it’s not like the past, when the roads were always being jammed by too many motorcycles. But now Vietnam has much bigger cars on the road.

What segment of the real estate market in Vietnam is attracting the most attention from Singaporean investors?

I’m talking about individual investor, what we’ll be looking out for in Vietnam today if they’re going to invest here. Of course I’m not a big corporation, no big company I won’t be looking into industrial park or anything or even big development. So I’ll probably start looking I will start with something that’s easy to understand.

We will do something with apartment segment, which in Singapore we call condominiums. In my opinion, because of the Singapore developers who have been here, namely Capitaland - they have been here for such a long time since 1990s. And along with the process they came to Vietnam, they also bring in a lot of trust from the Singaporean into this country. So to start off, normally will be residential property. Ideally, if Singaporean can also go into the villas segment, that will be very interesting. Of course, regarding Vietnam’s real estate market, you have to be much clearer in the rules and regulations to protect the foreign investor when they purchase property in Vietnam.

How do you perceive the potential of the industrial real estate sector in Vietnam?

In terms of the industrial industry market, Vietnam now becomes the next world factory. In the past, China was the world factory, but I guess China has somehow closed a lot of doors and is trying to recover. But during the Covid period, we know that a lot of businesses have actually transferred into Vietnam’s market. That’s why we think that we’re looking at Singapore government, because they have the foresight, that’s why they are going ahead with for more not just for more thing will be more later than Singapore industrial park. And with that, I think more businesses in Singapore, especially those who deal with manufacturing, they will probably want to make inroads into Vietnam and set up factories here in industrial real estate.

Can you talk about your experience in working with the Vietnam National Real Estate Association (VNREA)?

As I mentioned earlier, I’m representing the Institute Real Estate Agents of Singapore. We are actually a community for the agents back in Singapore. Singapore alone has about 30,000 real estate practitioners, registered, licensed and what we do is that together. We’ll try to look for some opportunity for them when they want to go abroad. They want to look into other countries in this case like Vietnam. They want to understand the landscape better. They want to know who they can tied up with and bringing Singaporean purchaser to come to the Vietnamese market. They need to know the situation, the market condition here, some data, some understanding of the locations.

And currently we are working with the Vietnam National Real Estate Association (VNREA) as well as we are also working with Vietnam Association of Realtors (VARS). What we do is that we have brought together programs in exchange, and we will go, we have actually planned for the webinars to share our experience.

In fact recently, we collaborated with VNREA to conduct a study tour for our members who came here and they were quite happy. They got to meet up with the local developers. They will meet our local real estate agents, and he has changed the idea and they also exchanged context of future use, and I think those are some constructive areas that we can actually look at.

How do you view the development of Vietnam’s real estate market in the time to come?

Now we’re going forward to 2024, the government is actually making an effort to take up all those illegal developers in Vietnam, that gives a lot of confidence for foreign investors and especially Singapore and they will probably enter another area because of the strong currency of Singapore dollars. So they will always be looking out for investment there.

Certainly, there will be a more discerning approach in selecting a reputable developer, where the presence of reliable developers and high-quality buildings is evident in the trajectory of apartment development. The emphasis on better quality is likely to generate increased interest. This is attributed to two key factors – a robust currency and the elevated buying costs in Singapore.

Looking ahead to 2024-2025, it appears to be an opportune time to enter the market. However, a clear understanding of the structure in Vietnam is crucial. It’s advisable to conduct more roadshows from Vietnam, collaborating with Tyra Rivas and IEA. In Singapore, organizing roadshows can be beneficial, inviting property developers and investors. Creating an event or convention could further amplify interest.

Considering my role at IEA, it’s essential to clarify that we are not a brokerage firm but a nonprofit organization. Our focus is on facilitating connections and matches for our members. While we don’t pursue profits, we are willing to play a role in transactions, acting as intermediaries without expecting anything in return.