The Vietnam real estate market in 2019 was doing great. The demand was high, the real estate investors and developers did their part, and all seem to work out just fine for everyone.
That made many analysts wonder whether 2020 will bring something more than steady growth. At the same time, many of them think they know the answer to that. For them, the answer is a strong yes, and they believe that everything points to that.
Here’s what they think will contribute to the exceptional growth of Vietnam’s real estate market.
Vietnam’s Galloping Economy
Vietnam’s economy is set for another excellent growth. According to the World Bank, their real GDP is on a path for a 6.5% growth. They think that growth will also continue in 2021 as well. Almost any other economic indicator points to growth and expansion.
Furthermore, other major analysts think that the World Bank’s projections are somewhat conservative and that the growth will be even greater.
Historical data and experience from other countries suggest that growth like that will have a profound effect on the real estate market.
China is Betting Big on Vietnam’s Growth
Vietnam is set to play a huge role in China’s “One Belt, One Road”. As a result, China’s investments are exponentially rising every year. So far, they have invested billions in infrastructure projects as well as in Vietnam’s real estate market. According to several Chinese analysts and newspapers, there will be even more investments in 2020.
Vietnam’s population is growing at quite a pace. They think that the current 95 million will grow to around 120 million by 2040. That means parallel growth for housing and property.
The Residential Sector is Very Strong
In the last few years, the residential sector has been galloping and was the main engine of Vietnam’s real estate market. The demand was especially strong for new and improved housing. Most of the buyers in this sector were wealthy families and white-collar workers.
Growing Foreign Investments
According to the reputable trading economics organization, the real estate sector is set to receive 10.2 of all foreign investments in the country. That’s several billions of dollars in the real estate market.
Growing Middle Class
The middle class at the moment accounts for around 15% of the entire population. But that percentage is galloping along with Vietnam’s growing economy. Many analysts predict that in the next five or six years, that percentage can easily reach 27 or 28%.
As suggested at the beginning, everything points to a great year for the real estate market. There are no signs of a bubble; the middle class is growing, foreign investors are not afraid to make big investments, and China acts as a big brother.
China’s strong push for Vietnam’s development did not go unnoticed by international analysts. At the same time, they don’t mind other foreign investments in Vietnam. So, that makes it a win-win situation for all parties, especially Vietnam and its people.