The Surprising Wealth-Building Strategy: Young Investors are Making a Fortune in Real Estate

Recognizing the growing demand for rental apartments, many young professionals aged 28-35 with stable incomes have taken advantage of favorable policies offered by developers to purchase apartments through installment plans. This strategy allows them to generate rental income while building their asset portfolio for the future.

In Binh Duong, for example, some apartment projects priced between VND 2-3 billion/unit have seen a high proportion of young buyers, ranging from 60-70%. One such project is the high-end The Emerald 68 by the Le Phong Group and Coteccons, which recently launched its third sales phase with units priced at VND 1.9 billion each. The project has attracted buyers from Ho Chi Minh City, with diverse intentions, including occupying, renting, or waiting for price appreciation before reselling. Notably, the developer is offering special incentives for buyers during this phase, making it more accessible for young people with stable incomes to own an apartment with an installment plan requiring less than VND 1 billion upfront to move in immediately.

Specifically, buyers of The Emerald 68 apartments only need to pay an initial 10%, or VND 190 million, to sign the purchase contract. They can then pay 20% upon receiving the house (within 18 months) and 50% (approximately VND 1 billion) to move in, with the remaining balance payable over the next 13 months. Buyers also benefit from a 24-month interest-free and no-principal payment period. This policy enhances investment returns by minimizing the initial payment and extending the payment period to 33 months.

With its flexible payment plan, The Emerald 68 has provided young people with an opportunity to own a home amid rising property prices. They are embracing installment plans, viewing apartments as both a wealth-building asset and a long-term rental income generator. Additionally, its prime location on National Highway 13, just 800m from Thu Duc City, enhances the commercial value of the apartments, making them more appealing for both renters and potential future buyers.

Sharing their insights, Savills experts believe that now is a good time to invest in rental apartments. Over the next 3-5 years, the supply of inner-city apartments in Ho Chi Minh City will remain limited due to land scarcity and legal hurdles. As such, investors can consider renting out their units for a while before selling them later. Apartment investment still offers decent returns, along with the added benefit of rental income.

According to Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, in the past, many people believed that apartments were a non-profitable investment, often resulting in losses. However, investing in apartments and renting them out has become a popular trend in major cities, offering the dual benefits of consistent monthly rental income, which is higher than bank savings rates, and potential capital appreciation.

Mr. Dinh also highlights the positive outlook for the apartment market, given the recovery of production and business activities, which is driving strong housing demand in urban areas. With stable incomes, young people can now consider purchasing apartments with reasonable and safe installment plans.

Notably, some large developers have introduced policies that allow young people to buy homes with installment plans comparable to rental costs. By committing to a maximum interest rate cap, buyers can avoid the risks associated with floating interest rates.

However, in the context of a challenging real estate market, those purchasing apartments as a long-term investment need to consider various factors. Price, area, and living environment are crucial aspects to contemplate before making a buying decision.