BUYING APARTMENT IN HCM

Over the decades, over all, we made good money buying and eventually selling real estate in America. On occasion, we also lost money. In most cases this was property that we actually lived in, even if it was an apartment building. We also own property in Viet Nam and have investigated buying property in TP HCM.

The most important thing is to understand your specific situation. Depending on a person's specific situation, buying any specific property can be a wise decision or a horrible mistake.

One "rule of thumb" is that renting is better than buying if you are going to live in a property for less than 5 years. For someone who is interested in buying a long term residence, I suspect that they will likely do reasonably well.

As to buying a property to rent as an investment, I'm living in a rented house, owned by a very intelligent Vietnamese family; who nearly got in serious legal trouble for, previously and unknowingly, renting this house to a Chinese criminal gang. As others have pointed out, the higher end, or foreigner market is already oversupplied and supply is rapidly being expanded by new construction. Personally, I suspect that buying rental property, at this point in time, in TP HCM is a bad idea for most foreigners.

Hi Noah,

I bought a piece of land here for my wife (Vietnamese citizen) a few years ago. It's not simple!
Just one advice for you:
- Be careful of the real estate agent. I never find an honest one! Maybe, I am just the unlucky one!

Goodluck!

dannydo wrote:

Hi Noah,

I bought a piece of land here for my wife (Vietnamese citizen) a few years ago. It's not simple!
Just one advice for you:
- Be careful of the real estate agent. I never find an honest one! Maybe, I am just the unlucky one!

Goodluck!

I'm sure that their are good Real Estate Salespeople in Viet Nam. But, like you, I haven't found one yet.

I'd suggest driving around in areas that you are interested in and searching for "For Sale Signs." That is what most Vietnamese do. I'd also get a Lawyer to handle the transaction.

I might be wrong. But, to the best of my knowledge, their is no legal requirements to be a "Real Estate sales/broker person, while Lawyers do have to meet specific standards.

Just a warning: A couple of days ago it transpired that all the apartments in a recently completed block near the airport had been sold and people had moved in, decorated etc.

It appears that the developer of the block - the Vietnamese refer to them as the "Investor", pocketed the cash payments made by the apartment purchasers and now lives in America.

The bank that funded the development wasn't repaid by the "investor" and has now taken ownership of the block. The apartment owners now have to pay for their apartments again or be evicted.

If you buy a property:
1. DON'T TRUST ESTATE AGENTS!
2. Make sure that you get the Pink Book of ownership, which is proof that you paid VAT on the property.

eodmatt wrote:

Just a warning: A couple of days ago it transpired that all the apartments in a recently completed block near the airport had been sold and people had moved in, decorated etc.

It appears that the developer of the block - the Vietnamese refer to them as the "Investor", pocketed the cash payments made by the apartment purchasers and now lives in America.

The bank that funded the development wasn't repaid by the "investor" and has now taken ownership of the block. The apartment owners now have to pay for their apartments again or be evicted.

If you buy a property:
1. DON'T TRUST ESTATE AGENTS!
2. Make sure that you get the Pink Book of ownership, which is proof that you paid VAT on the property.

The big issue is that, unless am badly misinformed, "Escrow" or putting the money into a third party account to be released to the seller after he produces the required documents, a Title search is preformed and Title Insurance is obtained, just isn't available for most transactions.

Yep. Nutshell.

Many developers start construction without the funds to complete the job. Travel the road between La Gi and Phan Thiet, there are about 50 abandoned projects just on that one road.

The government owned developers do some of the worst work you have ever seen and walk away with the dollars and tell the owners "bad luck".

Vietnamese property law doesn't protect the buyers like as many other country law do. In many countries the builder should deposit up to 70% percent of the total cost. He can only withdraw this amount after finished the project and handed over to the parties. Here day by day we can see real estate cheating. Many builders collect money including VAT which they utilize for some other project or own bank account. That's why many apartment owners get their registration certificate too late. I read many news about builders collect money and handed over the apartment but still they are in threat of evacuation from banks from which the builder pledged to loan high amounts which the builder never pay!
People work hard and save money for years to get some shelter. After buy these kind of apartments again they need to find some bucks to confront legal proceedings!
I heard people even stuck in government projects too!
It need a very good research before you invest your hard earned money in to these projects.

Its up to the government to put systems in place, but with the amount of corruption,fake paperwork and dishonesty here it's a slow road. The lands department here is one of the most corrupt and complained about government bodies. Instead of worrying about changing the visa laws every few months, the government really needs to focus on the issues that are affecting it's people.

I think that this is not the good time to buy as the prices are not "real" for appart as well as for private house. notably in Ho Chi Minh city. Besides, if you consider it as an investment, you could buy an appart for rent and yourself rent an another one. Anyway, I prefer a private house to an appart as it is easier to sell and you could have some profit by selling.

Beside the market. Does anyone have problem taking the money out of VN after selling the property.  What are the process, how long to get the approval(s) and what is the estimate cost  in % (legal and tea money). Pls share your experience.
Thanks.

I will check and inform u later. Maybe next week. I am quite busy with some deals from my clients.

What you bring in you can take out, also what you earn legally, but you must have all documentation to prove it was legally done.

colinoscapee wrote:

What you bring in you can take out, also what you earn legally, but you must have all documentation to prove it was legally done.

This is hearsay but I understand that what you say is true.  You can take out what you previously brought in as long as it is well documented. However, you cannot take out capital gains.  So if you bring in $100K, buy a home, and resell it for $125K, you can only take out the $100K.  The rest has to stay back.   Viet Kieu are probably the largest group taking out such profits and usually do so through black market means while not paying taxes on either end.

If you put yourself in the shoes of the government, this policy seems reasonable.  Removing gain of speculation from the country is a drain on the economy.  On the other hand, investment in productive enterprise is more favorable to the country than investment in existing real estate and so should, and may be, treated differently.

If you need a place to live then trying to time the market does not really work. The market here is not crazy. You can get value for your dollar. Are you bringing US dollars? Your exchange rate is probably good now. I live near Phan Xich Long. It is close to everything. It is also very busy and the air is bad. You can go 20 minutes out to Bin Loi. Clean air. Low prices, but you need to ride 10 + minutes for everything except coffee. When an economic shock occurs, new apartment prices sink 20% plus for 2 or 3 years. But they gradually come back. Trying to sell in a downturn is hard. Transactions are not straightforward here compared to Australia or Singapore. So find a good lawyer to ensure you end up with what you paid for. Good luck.

DONT buy an apartment in Vietnam!

Hi guys,

Just to check, is this a good time to buy apartment now?

Any input will be much appreciated.

-noah

- @noah83

Dear Sir or Madam,

I am Dieu Dinh, Sales Executive in Hochiminh City... <snip>