Bloggers

New Regulations Make Burgeoning Central Vietnam More Welcoming

Vietnam is a country full of delightful contradictions. Nowhere is that more apparent than its central region, dominated by the UNESCO World Heritage Sites of Hoi An and Hue sandwiching burgeoning Danang. Hoi An is an ancient trading port that flourished between the 15th and 19th centuries and boasts postcard perfect Chinese, Japanese and French-influenced architecture. The Nguyen Dynasty ruled Vietnam from Hue for nearly 150 years, and it’s home to perfectly preserved palaces and monuments including Vietnam’s own Imperial City. The My Son Sanctuary features excellently preserved Hindu temples and tombs dating to the 4th century. Yet the flip side of Central Vietnam is its natural wonders: the Hai Van Pass that snakes up a sometimes cloud covered hill between Danang and Hue, the unspoilt Cham islands and the white sands of My Khe beach that stretch for 30 kilometres south of Danang. It is no wonder that developers are capitalising on the region’s assets to offer investors and homebuyers a chance to own their slice of heaven.

Open Sesame

Come July, buyers will become increasingly more international when amended housing laws come into effect. Previously, only foreigners married to Vietnamese nationals or those making contributions to the country were allowed to purchase property. July 1st will let anyone with a valid visa, along with international companies and organisations operating in Vietnam, to buy houses and apartments. They are still restricted to 30 percent in any residential building or 250 houses in any ward within the country, but there is no cap on the size or number of units anyone can own. Previously foreigners could only purchase one condominium and no landed property in Vietnam. In addition, their residence can be sublet, traded, inherited or collateralised; before, only the owner could use the property. Buyers still must adhere to a 50-year leasehold, with renewal possible upon expiry; if they are married to Vietnamese nationals, they enjoy freehold tenure. It is a move by the Vietnamese government to attract more international investors while energising the property market after the devastating 2008 financial crisis.

For buyers whose interest is piqued but want the reassurance of a familiar brand, there are international agencies lending helping hands. Canadian Michael Piro has lived in Vietnam since 2006 and is the general director of Vietnam Sotheby’s International Realty. He has overseen the sale and lease of more than US$300 million worth of luxury Vietnamese properties including The Nam Hai and Hyatt Regency Danang, and believes that Central Vietnam has a lot of potential compared to the more mature markets of Hanoi and Ho Chi Minh City.

Competitive Yields

“Danang has a population of one million people, which is the country’s fourth largest city,” Piro states. “Forbes rates My Khe Beach one of the top six beaches in the world. Danang’s airport is expanding again. The government has put US$340 million into four key infrastructure initiatives over the past five years. Things happen in the Central Coast faster and to a higher standard than elsewhere in Vietnam. And the tourism industry is developing with bullish brands; the five-star segment currently makes up 32 percent of the supply. Vietnam is more stable politically than Bali or Thailand; it has an ethnically homogenous, primarily Buddhist population. The property market is like Phuket 10 years ago. We are seeing annual yields of 5.11 percent for Hyatt Regency Danang compared to 2.48 percent for Hong Kong residences. And the supply of branded residences is limited. For international buyers, Sotheby’s offers a layer of comfort in a communist country.”

Hyatt Regency Danang Residences, one of the properties Piro represents, has enjoyed steady sales since the first phase of apartments were launched in 2009. Developed by Indochina Land, the residences are situated north and south of a 20-hectare beachfront resort. While owners enjoy their own swimming pool and club facilities, they also have access to the Hyatt’s various dining outlets and spa. Four towers contain one-, two- or three-bedroom apartments and penthouses while 27 three-bedroom villas contain private swimming pools on 5,400-square foot lots. Owners have the option of putting their property into Hyatt’s rental pool, and their personal items can be stored during the time they are not personally using their home. Hyatt provides housekeeping services and full turn-key packages including appliances, furnishing and interior design courtesy of Aussie Diana Simpson. Condo prices start at US$350,000 (HK$2.7 million), and even Piro has a unit.

To a Tee

For those who prefer to gaze onto manicured lawns and start their mornings swinging, Montgomerie Links Residences are situated near holes eight through 10 on the 18-hole par 72 course designed by eight time European Order of Merit champion Colin Montgomerie. The 66-villa development (also courtesy of Indochina Land) is set within a gated community of private cul-de-sacs. They vary from a two-storey, three bedroom villa with private swimming pool at 2,600 square feet to a three-storey, four-bedroom villa with swimming pool, Jacuzzi, outdoor terraces and top floor master suite at 5,200 square feet. The elevated properties overlook the fairways with Ha My beach and sea views to the east and mountain ranges to the south and west. Residents have full access to Montgomerie Links’ facilities including its beachside clubhouse, dining outlets, driving range and golf academy. Prices start at US$500,000 (HK$3.9 million).