Vietnam is in the top 3 most sought-after real estate markets in the region.

The survey was conducted by CBRE in the last two months of 2023. This survey asked about investors' intentions and plans in the Asia-Pacific region in 2024. The results showed that Vietnam ranked second among the priority emerging markets for investment, after India. Third place belonged to Thailand.

According to CBRE, the two segments that attract foreign investors when entering Vietnam are industrial and office real estate. The growing commercial activities in Vietnam have boosted the demand for supply chain management and logistics. Investors have recognized the potential from these drivers and are very interested in industrial real estate.

In addition, developers and foreign investors are also very interested in land for housing development projects. Many investors have actively sought out properties at reduced prices or those of owners facing legal or capital difficulties. This trend shows the resilience and attractiveness of the housing segment in Vietnam.

Mr. Nguyen Pham Anh Duy, Director of Investment Consulting Department, CBRE Vietnam, said that foreign investors have a long-term vision of the potential of the Vietnamese economy. They are willing to invest capital to benefit immediately in the recent price adjustment cycle.

"This is especially true in the current situation. The buyer benefits from the seller being an investor who needs to divest after a long time holding the asset," said Mr. Duy.

The survey also found that Asia-Pacific investors are looking for double-digit returns, shifting their strategy to assets that can appreciate in value or assets that are experiencing funding problems and are forced to reduce their prices.

Accordingly, more than 60% of foreign investors plan to upgrade prime buildings in their portfolios according to ESG (environmental-social and corporate governance) standards in 2024. Most of them are private funds, real estate funds and real estate investment trusts (REITs). This is also a trend to pursue a strategy of increasing asset value.

However, CBRE noted that Vietnam’s real estate market has its own characteristics: scarce supply and assets that generate good cash flow are rarely offered publicly. The difference in price expectations between buyers and sellers is also a major obstacle in transactions.

Overall, CBRE assesses that demand for real estate projects in the Asia-Pacific region remains weak, while demand for projects for sale remains high. Investors in most markets, typically Japan, will continue to maintain a wait-and-see attitude in the first half of 2024.