Cluster residential and township assets to thrive in Vietnam this year

This is likely to happen in areas outside the top two cities of Hanoi and Ho Chi Minh.

According to Colliers, beginning in the second half of 2021, Vietnam’s economy experienced its gravest challenge in two years after being affected by the delta variant, which negatively impacted most real estate segments. However, that cannot negate the untapped potential of Vietnam’s real estate sector. 

“The industrial and logistics segment became hotter than ever as trade-related tensions between the US and China prompted manufacturers to diversify their operations in the region. The segment continued to grow throughout the pandemic with foreign direct investment in the manufacturing industry accounting for nearly 60% of demand for industrial and logistics assets in 2021,” the analyst added.

Here’s more from Colliers: 

In 2022, cluster residential and township assets will thrive, especially in areas outside the top two cities of Hanoi and Ho Chi Minh as the supply of residential real estate falls short of demand. Southern provinces such as Dong Nai, Long An, and Binh Duong, and northern ones, such as Bac Ninh and Hung Yen, will see the development of key projects, just as they have done over the past few years. We will also see a continuous upgrade in infrastructure in these regions, which serve as a bridge between people’s residences and their workplaces. 

We will also see growth in the distribution of e-commerce related logistics assets, such as warehouses and cold storage facilities, to serve the domestic market, in line with soaring demand for industrial and logistics real estate in key cities. 

Opportunities will only grow in 2022 as Vietnam opens up its economy further by signing various free trade agreements. And foreign investors will continue to benefit from favourable conditions created by policies such as a reduction in corporate income tax and import tax exemptions on various goods, as well as exemptions related to land rentals and land use.