Updated  
November, 05 2011 08:06:08

Real estate funds may boost investment

Potential investors look at models of properties in HCM City. A real estate investment trust fund would bring many practical benefits to both the market and investors, say analysts. — VNA/VNS Photo Hoang Hai

Potential investors look at models of properties in HCM City. A real estate investment trust fund would bring many practical benefits to both the market and investors, say analysts. — VNA/VNS Photo Hoang Hai

HCM CITY — Property analysts are calling for the establishment of real estate investment trust funds (REITs), saying they would yields practical benefits to the market and investors.

Like other funds, REITs can be publicly traded or privately held. Public REITs may be listed on exchanges like shares.

A senior World Bank expert said REITs were an effective channel for investment, development, and management of earnings from real estate, hotels, apartments, and other property.

Individuals can buy into the funds, even in small quantities, and have a source of regular income from dividends because 90 per cent of revenues have to be distributed to shareholders.

At a recent conference in HCM City, experts in real estate and construction spelled out the many advantages offered by REITs and exhorted property investors to consider them for mobilising funds.

Nguyen Van Hoang, CEO of the VREIT Management, said REITs would create safe, long-term investment opportunities.

Dividends could be lower than from shares but were higher than from government bonds, he said.

Phan Thanh Mai, general secretary of the Viet Nam Real Estate Association, agreed, saying REITs could make a significant contribution to the development of the country's property market.

Officials from the construction ministry said establishing REITs would help overcome the hurdles related to raising capital for housing development.

Housing development now relied on bank loans and a little bit on public funds.

REITs would mobilise disposable funds with small investors and households, they said, but for that they should get tax and other breaks.

REITs had been developing strongly around the world, but remained a new concept in Viet Nam which lacked a comprehensive legal framework for establishing and operating them.

An REIT market had to be created soon to facilitate development of not only commercial housing but also social housing.

This was because REIT could help social housing projects tap the market, helping ease the pressure on public funds. — VNS

Send Us Your Comments:
Name:
Your E-mail address:
Title:
 

VietNamNews may edit your comments and not all emails will be published.

Highlight

PM's India visit to bolster strategic ties 4    PM's India visit to bolster strategic ties

Prime Minister Nguyen Tan Dung begins an official visit to India today, aiming to consolidate the strategic partnership between both countries and take it to new heights.

Law to ease real estate restrictions 1    Law to ease real estate restrictions

Most National Assembly members yesterday agreed that the amended Housing Law should allow more foreigners to be eligible to buy or own houses in Viet Nam.

National team in training ahead of AFC challenge 1    National team in training ahead of AFC challenge

The Japanese coach of Viet Nam's national football team, Toshyia Miura, says that fitness and tactics will be his priorities in a 10-day training camp in the southern province of Binh Duong.

Bear bile tourism shuts down in Ha Long Bear bile tourism shuts down in Ha Long

Bear bile tourism in the northern province of Quang Ninh's Ha Long City has finally been shut down, according to the non-governmental organisation Education for Nature – Viet Nam (ENV).

Artist restores traditional values through paper Artist restores traditional values through paper

Artist Phan Hai Bang, who created a very special type of paper called truc chi, is now working with his team to bring back what he calls "old values" in a really big way.