THE ALTERNATIVE REAL ESTATE INVESTMENT CHANNELS TO CONSIDER AS REPLACEMENTS FOR FOUNDATION LAND

THE ALTERNATIVE REAL ESTATE INVESTMENT CHANNELS TO CONSIDER AS REPLACEMENTS FOR FOUNDATION LAND 31 July

Since May 2018, the liquidity of foundation land has dropped dramatically which concerned most real estate investors and led to the transfer of capital from foundation land to leased apartments/condominiums or resort real estate as the safe channels to collect the guaranteed interest every year.

PhD. Tran Nguyen Minh Hai – a Real estate expert – has claimed that in the period that foundation land market experiences the recent halt as well as the number of transactions dropped, capital flow will be divided and moved to other investment channels with higher dynamic.

Those are the kinds of assets that can be purchased easily, be leased or can return the investment, even though the interest is lower and the volatility is little but it is easier to control the cash flow. The real estate expert pointed out 3 possible real estate investment channels which provide investors with options to pick during this period.

Option 1: Resort Real estate

Condotel (Condo-Hotel) is an investment choice which attracts a majority of investors due to 2 factors as follow:

Firstly, condotels transacted on the market have the average price lower than 2 billion VND (equals to 87,000 $USD). This is a reasonable amount for such an investment.

Secondly, there is the application of profit guarantee from 8% to 12% of the condotel’s price per year for most of the condotel projects. This is considered the stable interest rate which is double the interest offered by most banks. However, investors should make a wise assessment and decision in which projects to invest in and which real estate contractors to put your trust in.

On the other hand, the intransparency in legislative status of the projects is also the problem which concerns most of investors.

For what to keep in mind when choosing a condominium project, visit: http://haiphatglobal.vn/golden-rules-to-be-noted-when-choosing-an-apartment-condominium-to-buy/

Option 2: Leased Apartment/Condominium

One of the least risky kinds of real estate available for rent which will become an attractive target for investors is leased apartment or condominium.

The demand is quite high, therefore, this segment has the sustainable growth as well as low fluctuation. On the other hand, beside the profit YOY, this type of real estate has the high chance to experience the price raise from 10% to 15% year after year. So, in the case the owner wants to sell the apartment, they can always get paid higher than they invested in the apartment, and the difference can cover the inflation as well as generate profit.

Option 3: Shophouse

The All-in-one shophouse or separated shophouse in the residential area acquires 4 to 6 billion VND (equals to 175,000 $USD to 260,000 $USD) in capital can be an alternative real estate investment that investors pay attention to. Compared to the foundation land, shophouse is the safer choice with many advanced characteristics: completed legislative documents, profitable asset, and stable price. In the case being used as a mortgage for bank loan, shophouse will be valuated with higher price than foundation land.

Source: Café.vn



Call to: (+84) 931 130 668