Despite a relaxing of the restrictions on foreign ownership in Vietnam giving them most of the same property rights as locals, investors have yet to flock to the country’s property market due to uncertainty over how the new laws work, VOA reported.
Many foreigners are content to wait the market out and see how officials will implement the new law. The Vietnamese government has yet to publish guidelines on how these new regulations on foreign ownership work. VOA added that people who work in the property sector say they’re surprised that after two months, the rules and guidelines are nowhere to be seen.
“This is a no-man’s land,” David Blackhall, managing director of VinaCapital Real Estate said. “Nobody wants to be the guinea pig to test out the new law.”
The real estate law lets foreigners obtain mortgages, rent out their homes and hold ownership certificates for 50 years, which can be renewed for another 50 years in Vietnam, but if they sell the property, it’s unknown how they will be able to get that money back to their own countries.
Anti-money laundering laws have made cross-border transactions difficult in Vietnam, with outgoing transfers being near impossible to complete without hefty fees and copious amounts of paperwork. Banks in the country require people to prove their source of income and limit transfers in addition to other documentation requirements and fees.
Marc Townsend, managing director of CBRE Vietnam, told VOA that when traveling to neighboring places like Tokyo, he’s encountered groups of foreign buyers scouting out opportunities. That isn’t happening in Vietnam.
“We haven’t seen busloads of Chinese,” he noted while adding that there’s a similar reluctance among foreign real estate developers and investors from around the ASEAN.
Vietnam may see more foreign investors buy property if the government relaxed some restrictions in the law, Le Hoang Chau, chair of the Ho Chi Minh City Real Estate Association, stated. He said multi-entry visas for one to three years for foreigners who buy property could make it more appealing. The current law says anyone with a valid visa to enter Vietnam can buy property but do not get any special visa rights.
