Highest return on investment among all investment channels.
According to data published by the Vietnam Real Estate Research Institute on short-term investment returns in Vietnam from January 1, 2022 to the present, real estate is maintaining the highest return rate at 14% per year.
Following real estate, corporate bonds are the next best investment option with a return of 8.5% per year, followed by SJC gold with 7.36% per year. Traditional investment channels such as savings accounts rank fourth with short-term returns of up to 6% per year. Notably, stocks are ranked last with a short-term return of -20.14%.
Analyzing the investment potential of real estate compared to other channels, the Vietnam Real Estate Research Institute noted that the attractive discounts offered by the real estate market in the recent period have made real estate an appealing investment channel. The report also recommends that, in the medium and long term, investors should consider allocating their capital to investment channels according to their risk tolerance, financial capacity, as well as their knowledge and experience.
Rate of return of popular investment channels over the past nearly two years.
Furthermore, in this report, the Vietnam Institute of Real Estate Research also clearly analyzes the current state of the real estate market. Accordingly, in the recent period, the real estate market has slowed down due to a number of difficulties and obstacles, most notably legal issues and access to capital. The Government , Ministries, and relevant agencies have made efforts to improve the legal environment related to the industry.
Another obstacle is the ongoing revision of the three most important laws directly governing the industry's operations, which are expected to be submitted to and approved by the National Assembly in 2023; simultaneously, implementing solutions to ensure market transparency and decisively address violations that have occurred recently.
The market is showing many positive signs.
According to the Vietnam Institute of Real Estate Market Research, in order to support and promote healthy and sustainable market development, from the beginning of the year, the State Bank of Vietnam has directed and required credit institutions to strive to reduce lending interest rates for the economy , aiming to accompany people and businesses in overcoming difficulties,...
Compared to the beginning of the year, lending interest rates have now decreased by 1.5-2%, many banks have offered preferential credit packages, and are expected to continue to decrease slightly in the near future. This is a very positive signal for the market, as the cost of capital decreases and selling prices become more attractive because investors can access loan capital at more reasonable interest rates.
With lower interest rates, customer demand for real estate is expected to improve. Lower interest rates will certainly boost customer search and transaction activity. Furthermore, this will create a more positive sentiment for the real estate market and is expected to recover from Q2/2024.
Lower interest rates have made the real estate market a more attractive investment channel.
Regarding investment choices, the Vietnam Institute of Real Estate Market Research believes that reputable developers with experience in successfully implementing many projects, sound financial capacity, and projects with clear and transparent legal status and prime locations will have more advantages, be prioritized by banks with reduced interest rates, and attract more customer interest and choices.
For investors, if their financial situation is sound and market prospects are positive, they can consider using a leverage ratio of 60-70% (equity capital) and 30-35% (borrowed capital) because current market conditions are changing too rapidly and unpredictably, especially over the next 10-20 years.
"In the current context, investors should consider focusing on real needs such as apartment and detached house segments serving residential, business, rental, or long-term investment purposes; especially since real estate prices have been discounted quite attractively in the recent period and are now close to their true value," the report from the Vietnam Real Estate Market Research Institute stated.
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