Interest rates and good policies, buyers “withdraw money”
In the context of cash depreciation, the bank interest rate has decreased significantly, and the sales policies of investors are quite good. Many people decide to “withdraw money” to invest in apartments for rent with the expectation of “compound interest” (generating cash flow and waiting for the apartment to increase in price).
The current transactions are mainly focused on product lines that meet real needs, projects with clear legal status, prestigious investors, and existing products.
In completed apartment projects, the demand for buying is “increasing enthusiastically” at this stage.
Recently, in Ho Chi Minh City or Binh Duong, some apartment projects that have been handed over or are about to be completed have recorded an increase in demand again. In particular, some projects support payment policies that are even “stronger” than future projects.
For example, the Flora Panorama apartment project in Mizuki Park has been completed and handed over in the South of Ho Chi Minh City, and the investor Nam Long is currently offering a high-class furniture package worth up to 500 million VND, with immediate occupancy (in case the customer does not borrow from the bank). If there is a loan, the bank will lend up to 70% of the apartment value; no interest will be paid within 2 years, only a fixed interest rate of 2%/year will be paid within 24 months, equivalent to about 4 million VND/month, and the house will be received in December 2024. This installment is no different from the cost of renting a house, even cheaper than renting an apartment monthly.
Or, the Phu Dong Sky Garden apartment project is about to be handed over in Di An, Binh Duong, the investor has a policy of a direct discount of 15% in case the buyer pays 70% of the apartment value. If purchased in April 2024, there will be an additional 2% discount, with a total discount of 17%.
This apartment project is located adjacent to Thu Duc City (Ho Chi Minh City), 600m from Pham Van Dong Boulevard, and is a rare supply of completed apartments in the area. The project is expected to hand over the first phase in June 2024. Due to its location adjacent to Thu Duc City, the source of tenants is quite good, from students at the National University Village to neighboring office workers…
According to insiders, for young customers, with limited initial capital, buying an installment apartment for rent is also a good solution to be able to pay for bank interest, and it is an asset “saved” for the future.
Sharing recently, Mr. Le Quoc Kien, a real estate investment consultant, said that in the past two years, the real estate market has entered a purification stage, which is a playground for investors using idle money and money from other stable income from production and business operations. Accordingly, currently, real estate products that focus on real usage needs have liquidity. At the same time, clear legal status and immediate usability are being prioritized by buyers. For example, townhouses, apartments that can be occupied or rented immediately; factories that can be used for production and business or for rent, or land plots that are exploited for agricultural production and business…
Not new but sustainable
According to experts, investing in apartments for rent is not a new direction for the real estate market but is of interest to investors due to the stable cash flow. In particular, in the context of an unpredictable market, long-term stability is prioritized.
It can be seen that after a period of market fluctuations, many people have shifted their attention to projects with clear legal status, red books in hand, or projects that are about to be handed over instead of still “on paper” to limit risks, ensure cash flow and increase asset value.
From an investment perspective, handed over or about to be handed over apartments bring many advantages to buyers thanks to the ability to rotate capital quickly from the exploitation of renting out complete apartments.
Investing in buying apartments for rent is being prioritized by investors.
Apartment rental prices are increasing, and the scarce supply for rent is an advantage. Considering the current apartment rental rate is still higher than the bank’s savings interest rate. For example, an apartment of nearly 4 billion VND in Ho Chi Minh City can be rented for 13-18 million VND/month (depending on location, area); apartments priced at around 3 billion VND/unit in Binh Duong have rental prices ranging from 8 – 12 million VND/month (depending on area). Even in some areas, apartments for rent are in a situation where demand exceeds supply.
The results of a survey from Batdongsan.com.vn have shown that the type of apartment for rent still has quite good growth momentum, and the level of interest remains at the top when the gross profit margin is up to 12.5%/year (rent and price increase). When the ability to buy a house for young families continues to be limited, the rental housing segment is a good choice for investors.
Also according to Batdongsancom.vn, the rate of return from investing in apartments for rent in Ho Chi Minh City has increased to 4.6%. Although it has not yet reached the same level as before the epidemic, it has been more positive than in 2022. In the first months of 2024, the rental price of apartments in Ho Chi Minh City may increase by 4 – 6%, accordingly, the rental yield will also increase back to 4.9% as before the epidemic. Thus, the demand for investment in the apartment segment will increase again, leading to increased liquidity in the near future.
