Vietnam's real estate investment market is showcasing promising growth, particularly within the rental apartment sector. Recent discussions among real estate experts at the "Potential of Lease Homes" workshop, organized by the Vietnamese Real Estate Brokerage Association (VARS), have highlighted trends indicating significant investment potential, especially for high-end rental apartments.
According to Nguyen Van Dinh, the President of VARS, high-end serviced apartments for long-term lease are quickly becoming attractive investment channels. He noted, "Căn hộ dịch vụ cho thuê dài hạn cao cấp tại các quận lõi trung tâm ... là một kênh đầu tư hấp dẫn," highlighting the desirability of these properties located in prime urban areas such as Hoan Kiem, Ba Dinh, Dong Da, and Hai Ba Trung. The trend emerges partly from rising middle and upper-class demands, alongside the influx of foreign professionals driven by foreign direct investment (FDI) and the expansion of high-tech industrial zones surrounding Hanoi.
Le Dinh Chung, CEO of SGO Homes, echoed these sentiments, stating, "Nguồn cầu căn hộ dịch vụ ngày càng gia tăng nhờ ... dây chuyền phát triển." The appeal of serviced apartments, which offer flexibility and comfort for long-term residents, aligns well with modern lifestyle demands. Chung emphasized the overall increase seen within the rental market, pointing to rising occupancy rates, which are currently above 80%. This suggests stable income prospects for investors.
The FDI figures bolster these claims, with substantial investment flowing to northern provinces—most recently showcasing $31.38 billion as of late November 2024, marking a 7% increase year over year. This influx has substantially increased the number of long-term visitors and foreign professionals seeking quality housing arrangements.
At the same time, with the housing market observing rising prices, many prospective homeowners are turning to rentals due to affordability issues. The changing social dynamic—marked by rising divorce rates and increased numbers of single residents, particularly Gen Z—further fuels demand for rental units. It suggests socially driven motivations for choosing rental over ownership, with rentals increasingly seen as contributing positively toward apartment market stability.
Despite the encouraging upward trends, challenges remain. The rental apartment market, particularly high-end leases, is still experiencing limited availability. Experts note the supply of premium rental apartments, especially those located centrally, remains low. Recent reports indicate only about 1% of new listings are within central Hanoi, even though approximately 30,000 new units have come on the market.
Chung has cautioned investors about legal frameworks surrounding property rentals. He provided insights on necessary legal precautions for both landlords and long-term tenants to prevent disputes, stressing the importance of clear contractual agreements between involved parties.
The perspective on rental trends also incorporates awareness of social impact. Vo Tri Thanh, from the Institute of Brand and Competition Strategy, remarked, "Thuê nhà đang trở thành từ khóa 'hot' ... góp phần kéo mặt bằng giá phù hợp hơn." This statement implies broader societal relief on market pressures, allowing more affordable access to housing for the lower-income population, providing necessary equilibrium within the housing market.
Gen Z, as noted by industry specialists, seems to be shaping this trend toward rental units, continuing the shift as traditional family structures evolve. Meanwhile, expatriate professionals remain one of the most significant demand drivers, which Nguyen Minh Phong highlighted, as the surge of foreign interest would invariably grow alongside urban industry expansions.
Overall, as Vietnam's urban environment becomes increasingly internationalized and diverse, prospects for the rental apartment market appear bright. It remains pivotal for developers and investors to stay informed about shifting consumer preferences, legal requirements, and market demand fluctuations. The successful players will likely be those who can navigate this dynamic space effectively and anticipate future changes.
