Monday, October 21 2019


Investors look to lease property

Update: November, 17/2014 - 09:19

Apartment buildings in HCM City's Phu My Hung Urban Area. Investment in high-end apartments for lease has become popular among property investors this year. — VNS Photo Viet Thanh

HA NOI (VNS) — Last year, most apartments in Viet Nam were bought by owner-residents, but this year, it seems that many more buyers are interested in leasing them.

A survey of 5,000 customers by a property trading floor in Ha Noi over the past three years shows that long-term investment in high-end apartments for leasing in the centre of the city has increased from 11 per cent in 2012 to 15 per cent in 2014.

About 20 to 25 per cent of customers buy an apartment with the intention of leasing, said the property trader.

Investors, who buy apartments from high-end projects in Ha Noi and HCM City such as at Indochina Plaza Ha Noi, Dolphin Plaza and Starcity Le Van Luong, can earn a rental yield of about six to seven per cent a year.

The investment is considered more profitable than putting money in banks.

Tran Binh, an investor in Royal City in Ha Noi, said that his 100sq.m apartment could bring him about US$1,000 to $1,200 per month.

The income from a rental house is not high but it is stable, he added. Investors also expect that housing prices will increase as the property market is warming up.

Buyers are often encouraged with the offer of rental services by developers. For example, development companies in the Watermark project introduced a programme of supporting buyers to find customers and committed to a rental yield of seven per cent per year.

According to the property-service provider CBRE Group, the number of customers asking for apartments to lease has increased. The rental prices now range from $2,000 to $4,000, nearly double that for the same period last year.

However, the supply of high-end apartments in central districts in Ha Noi is expected to narrow following Decision 996/QD-TTg signed by Prime Minister Nguyen Tan Dung to end construction of commercial housing projects in the area.

The decision is a part of a programme on housing development in Ha Noi for 2012-2020 and towards 2030. Priority will be given to construction of urban areas and residential areas on the city's outskirts. The decision also puts a temporary end to new commercial housing projects in the city's four downtown districts - Dong Da, Hoan Kiem, Ba Dinh, Hai Ba Trung and part of southern Tay Ho District.

Experts said although leasing apartments was an attractive investment, customers, mainly foreigners, mostly showed interest in apartments in the centre of the city with good security. — VNS

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