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What are the pits of investment properties in these emerging countries in Vietnam and Cambodia?
Real estate one Ma Yifan Luo Qiang
In 2016 and 2017, when the national audience watched the CCTV Lantern Festival party, they knew a real estate called Country Garden City, because Country Garden was named the CCTV Lantern Festival for two consecutive years. At that time, the Malaysian property market next to Singapore was popular. When it comes to investing in Southeast Asia, most people think of Singapore, Thailand, and Malaysia.
When it comes to Vietnam and Cambodia, most people may think that these two developing countries are only suitable for literary youth to travel at most. In fact, between 2016 and 2018, the number of Chinese buyers who bought houses in Vietnam and Cambodia has been exploding. Many Chinese housing companies that entered Malaysia in 2012-2016 have been smashing the Cambodian capital Phnom Penh since 2016.
According to the inquiry data of the overseas real estate information network, the number of inquiries from Southeast Asian countries such as Thailand, Malaysia, Vietnam, the Philippines and Cambodia has increased significantly in 2018. Between 2015 and 2018, the number of enquiries for Vietnam increased the most.
Q: Are there many Chinese people who invest in real estate in Vietnam and Cambodia?
In the past two years, Vietnam and Cambodia have become the emerging destinations for home buyers, mainly because the local government has promoted the legislation of foreigners buying houses. Secondly, Southeast Asian countries such as Thailand and Malaysia have already passed a round, and house prices have risen too high. Or the local government has not encouraged foreigners to invest, making Chinese domestic investors look for other targets.
On April 5, 2010, the Cambodian Parliament passed the Foreigner Real Estate Property Law jointly drafted by the Ministry of Land, Urban Planning and Construction and the Ministry of Justice. According to the law, foreigners have the right to purchase houses in Cambodia and have legal property rights. .
After the law was promulgated, it first attracted housing companies and investors from Japan, South Korea, Taiwan, and Singapore to enter Cambodia. Until 2016, housing companies in mainland China began to enter Cambodia, and they also brought a large number of domestic investors.
80% of the customers built by these Chinese developers are Chinese.
The Vietnamese National Assembly approved the amendment to the Housing Act on November 25, 2014, which removed many restrictions on foreigners' purchases. The revised law came into effect on July 1, 2015. According to the new Housing Law, foreigners who have visas to Vietnam, foreign investment funds, foreign banks, foreign companies can purchase houses at branches and representative offices, and can purchase apartments and villas containing land titles.
After the bill came into effect, more and more Chinese people went to invest in Vietnamese real estate. By 2018, 30% of foreigners buying homes in Ho Chi Minh City, Vietnam, are from China, the highest proportion.
It is very convenient for foreigners to buy a house in these two countries. As long as they get a visa to go to the local area, regardless of the type of visa, they can go to the real estate transaction. Most of these buyers have the purpose of investment, and most of them come from the first-tier cities in the north, the north and the south.
Q: In which cities do you usually invest in Vietnam and Cambodia?
The cities in which Chinese people buy houses are nothing more than Hanoi, Ho Chi Minh City in Vietnam, and Phnom Penh City and Sihanoukville City in Cambodia.
In the eyes of buyers, Hanoi is equivalent to Beijing in China, Ho Chi Minh is equivalent to Shanghai; Phnom Penh is the capital of Cambodia and the most promising city in Cambodia, while Westport is the most open place in policy and is becoming a new generation of “gambling city”. ——This was once a small fishing village. There are now more than 50 casinos and more than 30 casinos are under construction.
Housing companies and selling agents have also consciously compared these cities in Vietnam and Cambodia with cities such as Shanghai and Shenzhen, and have “missed the rise in domestic housing prices and don’t miss investing in emerging countries” as a selling point.
However, from the perspective of urban infrastructure support, Vietnam and Cambodia's major cities are still far from the level of first-tier cities in China. Even if they are more than ten years old, they will have to be questioned if they can develop to a certain extent.
At present, only Hanoi has just opened the first urban light rail line Jiling-Hedong project in Hanoi.China RailwayThe general contracting construction of the Sixth Bureau Group Co., Ltd. The Hanoi Metro Line 1 and Ho Chi Minh City Metro Line 1, which had been placed in high expectations by Vietnam, were all built by Japanese companies. However, they were involved in various disputes such as cost and bribery, and the progress of the project was nowhere in sight.
As the capital of Cambodia, the city of Phnom Penh is only a small town in the country. It has a young population, a vibrant business, a poor traffic situation, traffic jams in a timely manner, and security, public transportation, waste water treatment and other supporting projects have not kept up with real estate. The speed of development.
Xigang is a port city in southwestern Cambodia. The coast is busy, the water is clear and sandy, and it is also a holiday paradise. The city looks like a small town in southern China in the 1990s. In the past two years, the investment boom of Xigang has swept through, and there are new factories, real estates and hotels everywhere. However, with the development of casinos, various social problems have followed, and gangs, drugs and speeding parties have also profoundly changed this. Small town.
Q: What kind of property rights can I get?
Although Vietnam allowed foreigners to buy houses and obtain legal property rights in 2015, it set two demanding requirements.
First, the property rights of the house are only 50 years (Vietnamese citizens can have permanent property rights, foreigners who marry Vietnamese citizens can also own permanent property rights of the house); second, foreigners can only have one at most in an apartment complex or a district-level administrative division. For housing, the area and total number of houses purchased by foreigners are not limited, but the total number of houses owned by foreigners in each apartment area cannot exceed 30%, and the number of villas owned by foreigners in each district-level division cannot exceed 250.
In addition, in second-hand housing transactions, foreigners can only buy second-hand housing properties for foreigners; foreigners’ own property can be sold to Vietnamese locals or to foreigners, if sold to Vietnamese locals, 50 The annual property rights can be converted into permanent property rights.
The situation in Cambodia is different. Cambodia does not allow direct sale of land to foreigners. The Foreigner Real Estate Property Law stipulates that foreigners can only purchase houses of the second floor and above of high-rise buildings in Cambodia and obtain the same property title certificates as their citizens. Can rent and sell houses on their own.
That is to say, foreigners can own 100% of the ownership of the house in Cambodia, but do not include land ownership, nor can they buy the underlying property. This property right is called “divided property rights” in Cambodia. The property rights of most Cambodian locals are “hard property rights” or “soft property rights”, and land ownership certified by national certification bodies or local governments.
It is also worth noting that Chinese buyers may encounter two different houses with large property rights and small property rights in Cambodia. The large property rights are permanent property rights, and the term of small property rights is generally 99 years. This is caused by the difference in the nature of the developer’s acquisition.
Since the Cambodian government stipulates that foreigners cannot purchase land directly, Chinese developers generally seek local companies to cooperate with land, in which case they can buy land with freehold property; a small number of developers rent land, and the lease period is generally 99 years. Therefore, the house is the property right of 99 years.
Q: Is the rental rate higher? What is the return on investment?
In the promotion of overseas real estate agencies, the current high-rise apartments in Vietnam and Cambodia have high rental-to-sale ratios and return on investment. For example, a set of 50 to 60 square meters of high-rise apartments in Phnom Penh, rents up to 700 US dollars, and the price of Phnom Penh City began in 2015, an annual increase of 15%, currently reaching about 2,000 US dollars / square meter.
Vietnam has a set of 80 square meters with a total price of 180,000 US dollars. The monthly rent is about 1,000 US dollars. The average rental yield in Ho Chi Minh City is about 6%. At present, Vietnamese houses are divided into various types. The average price of luxury houses exceeds 3,500 US dollars / square meter. The high-end model is about 1,500 US dollars / square meter, the average price of the low-end category is about 800 US dollars / square meter.
However, the real estate market in these two emerging countries is currently small, the supply of high-end apartments is small, and most of the apartment tenants are also foreigners, and the high rents have far exceeded the affordability of local ordinary people. With the arrival of a large number of apartments in the past two years, the problem of future supply will be alleviated, and it is difficult to judge whether high rents can be maintained.
From the perspective of return on investment, according toTianfeng SecuritiesAccording to the research report, Vietnam real estate investment should be divided into the perspective of domestic residents' purchase and the perspective of foreign investors' purchase. The difference lies in the exchange rate change between the Vietnamese Dong and the US dollar.
Tianfeng Securities' research report pointed out that the average price of Vietnam's house price in 2006 reached 1650 US dollars / square meter has not been broken, the latest average price is about 1,543 US dollars / square meter, the dollar's perspective has not reached a new high.
However, its corresponding local currency price reached 35.23 million VND/m2 in 2018, surpassing 2008's 28.01 million VND/m2, an increase of nearly 20%, which is the Vietnamese Shield's perspective. "From the perspective of Vietnamese residents, with self-occupation and anti-inflation as the purpose of purchasing houses, we believe that the long-term trend of Ho Chi Minh's house prices in Vietnam's local currency will continue to rise; for foreign investors, for the purpose of leasing and investment, because loans are not as convenient as their own residents Exchange rate fluctuations may also bring investment losses, and the factors to be considered are different from the risks assumed."
In Cambodia, foreign-invested and built real estate has not yet formed a market for local residents to buy, and the local market has not yet formed a second-hand housing market because most of the ordinaryCommon peopleThey are accustomed to buying land to build their own townhouses. Therefore, although house prices are rising theoretically, it is also unknown whether foreign investors can withdraw from investment income.
Emerging markets have low investment thresholds and high yields, but the risks are also high. The first investors who enter this market may have already regained their returns and the later they enter, the greater the risk.
Q: How to pay? Will it be affected by foreign exchange capital controls?
Generally, Chinese buyers are allowed to enter the country with a tourist visa. After the house is satisfied, the deposit will be paid first. The procedures for paying the deposit are very convenient. Some developers even accept WeChat and Alipay payment, and the deposit is about two or three thousand dollars.
The remaining part is divided into the down payment and the final payment. The down payment is between 10% and 40% of the total price. The last payment is usually paid before the delivery. Since most of the properties are foreclosed, most of the time for paying off the balance is after two or three years.
In Cambodia, foreign buyers cannot enjoy low-interest loans like their own residents, and the loan procedures are cumbersome, while Vietnam does not allow foreign buyers to use leverage in Vietnam.
However, because the prices of these two countries are not too high, and domestic investors mostly invest in small apartment apartments, the total price is in the range of 60-800,000, the demand for leverage is not strong.
The down payment and the final payment phase are generally assisted by the developer or the developer's sales agent company, which involves the issue of foreign exchange control. According to the current regulations in China, the annual foreign exchange exchange amount is 50,000 US dollars. Customers who do not recommend the amount of credit are taken by the family members who hold the property together and exchange ideas with multiple people.
In addition, sales agents still have some financing tools in their hands. Some institutions provide financing for international real estate buyers. Some institutions in mainland China and Hong Kong provide cash support or financing for overseas property buyers in exchange for investors in China. Assets held in the territory. If the purchaser encounters financial problems, some sales agencies or real estate developers can provide certain financing channels.
Buying a house in Dawan District
In addition to these overseas emerging countries, in the context of high housing prices and strict purchase restrictions in the first-tier cities, considering the surrounding areas of the first-tier cities may also be an option. In the past two years, most people have rounded their dreams of living in this way.
"I have never made money on buying a house." Lao Liu once joked with his wife.
Liu, who is almost 50 years old, is doing business all his life. In his teens, he came to Guangdong from the countryside of Hunan Province. Starting from the assembly line of the electronics factory, he has always been the "heart" of the management team. Later, Lao Liu came out of the electronics factory and engaged in the import and export trade of assembly line equipment.
Lao Liu’s story of buying a house is exactly the same as that in the section. He bought two suites in Shenzhen Nanshan more than ten years ago, a set of more than 100 square meters and a set of more than 80 square meters. In order to start a business, he sold the big house, and the family of three lived in a small house. Nowadays, the situation is changing, and the big house can no longer be bought.
Seeing that his son is going to college soon, Lao Liu thought about buying another house. Under the leadership of his friends, he finally bought a large house in Huizhou, and paid a one-time payment. The decoration also cost more than 400,000. I bought another shop. In the Spring Festival of 2019, Lao Liu was ready to go to the new house for the first year.
Lao Liu’s idea is very simple. Many of his company’s clients are in Huizhou and Dongguan, and the prices are cheap. Maybe the company can move over. I live in Huizhou's house, and the Shenzhen house is reserved for children. Huizhou's life rhythm is also better than that of Shenzhen. After retirement, you can live and care for the elderly. You can also help with your grandson. The community has brought K12 education packages.
Judging from the cost of buying a house, Lao Liu is not able to afford the house in Shenzhen. He is only very afraid of debts. After thinking about paying a large down payment, he still has to borrow huge sums of money from the bank and bear interest. It is terrible to think about it.
From the bottom of my heart, Lao Liu does not think that the Shenzhen house is worth such a high price, but there is nothing to help. Two years ago, he firmly believed that Shenzhen's housing prices were too high and would collapse in the morning and evening. But now, he suggested that young people who can't afford a Shenzhen house can consider Huizhou and Dongguan because they always have a future development than their hometown in Hunan.
Lao Liu’s cautiousness is also related to the industry he is engaged in. In order to facilitate domestic and foreign payment, Lao Liu Company was established in Hong Kong, and the account is also in Hong Kong. The main customers are OPPO, Jinli and other mobile phone manufacturers. In 2018, Jin Li went bankrupt, and the hammer "selled", combined with the influence of import and export commodities, Lao Liu's business was not particularly satisfactory.
Before the Spring Festival, Lao Liu’s business encountered some trouble. Due to foreign exchange control, several payments in the country to Hong Kong account were subject to data review. Some were delayed and some were directly returned.
Lao Liu also intends to give the employee a year-end award this year, but in order to avoid the trouble of foreign exchange control, he had to take a few people to Hong Kong to withdraw cash, and then each person came back with a part, the drama was helpless.
Editor in charge: Zhang Zhenjiang
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