The property market in Vietnam is gaining more interest again and investors with longer memories might recall an era of frenzied activity in the middle of the last decade.
Winfield Wong, Head of Banking at HSBC Vietnam, has a way to tell if the underlying demand for property is driven by speculators or real local buyers.
“Look at what’s parked outside the showrooms: do you see cars or do you see motorbikes? When you see motorbikes, they are genuine buyers,” says Wong, in an interview with The Edge Singapore.
His optimism is driven by growing consumer income in the country. In 2009, it was just around US$1,000 per capita, but since then it has more than doubled to US$2,200 ($3,096) now.
“We expect both demand as well as improvements in productivity to have a positive impact on this per capita income. As you can imagine that this is starting from a very low base, percentage of growth will be phenomenal,” says Wong.
The growth is driven by general growth in the country’s economy, as foreign investors made their moves in sectors in property but also in supporting industries and markets like office space, hospitality, food and beverage, as well as manufacturing.
Broader changes in the economy are helping as well: Vietnam is one of the 12 initial signatories of the Trans-Pacific Partnership (TPP), which promises prospects of lower trade barriers. As a subset of sort, the Asean Economic Community, which aims for removal of tariffs among the 10 member states, is also slated to take effect by end of the year.
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Winfield Wong, Head of Banking at HSBC Vietnam, has a way to tell if the underlying demand for property is driven by speculators or real local buyers.
“Look at what’s parked outside the showrooms: do you see cars or do you see motorbikes? When you see motorbikes, they are genuine buyers,” says Wong, in an interview with The Edge Singapore.
His optimism is driven by growing consumer income in the country. In 2009, it was just around US$1,000 per capita, but since then it has more than doubled to US$2,200 ($3,096) now.
“We expect both demand as well as improvements in productivity to have a positive impact on this per capita income. As you can imagine that this is starting from a very low base, percentage of growth will be phenomenal,” says Wong.
The growth is driven by general growth in the country’s economy, as foreign investors made their moves in sectors in property but also in supporting industries and markets like office space, hospitality, food and beverage, as well as manufacturing.
Broader changes in the economy are helping as well: Vietnam is one of the 12 initial signatories of the Trans-Pacific Partnership (TPP), which promises prospects of lower trade barriers. As a subset of sort, the Asean Economic Community, which aims for removal of tariffs among the 10 member states, is also slated to take effect by end of the year.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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