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Tag: condo

  • Bangkok Sees Historic Decline in New Condominium Launches: Lowest Level in 15 Years

    Bangkok Sees Historic Decline in New Condominium Launches: Lowest Level in 15 Years

    Bangkok’s condominium market continued to feel the squeeze in the second quarter of 2025, with only two new projects launching and a mere 405 units introduced. This staggering figure marks the lowest level of new launches in 15 years, as reported by Knight Frank, underlining developers’ cautious approach in a climate laden with uncertainty.

    Market Mood: Cautious and Creased

    The subdued activity is attributed to multiple pressures weighing on the market, not least the psychological ramifications of a recent earthquake that has particularly affected completed projects with unsold units. As a result, ownership transfers saw a marked decline compared to the COVID-19 pandemic phase. Developers now find themselves extending timelines to clear their existing inventory, a move that inevitably incurs higher management costs.

    The Financial Tightrope Developers Walk

    Amid these challenging conditions, some developers are grappling with debt repayment issues that could threaten the overall financial health of the real estate sector. The report indicated that these strains might force price cuts or special sales strategies aimed at boosting revenue and managing cash flow effectively. While the challenges are mounting, many developers are not throwing in the towel; instead, they are employing adaptive strategies to weather the storm of 2025.

    A Steep Decline in Supply

    The ongoing trend highlights a decrease in supply, with Q2 2025 seeing the lowest number of condominium launches since 2020. All newly introduced units are situated in Bangkok’s northern suburbs, starkly contrasting the boom witnessed in Q2 2022 when the market surged to a staggering 15,164 units—its highest output in five years. Since then, the market has confronted a slowdown, particularly from Q3 2023 onward, where quarterly launches have frequently dipped below 8,000 units and even fell under 3,000 units at times.

    A Shift in Ownership Trends

    Compounding the slowdown, ownership transfers in Q2 2025 dropped to just 12,183 units—marking the lowest figure in over six years. This trend reflects a broader malaise in the market, punctuated by economic uncertainties and factors undermining buyer confidence, such as high household debt, soaring living costs, and tightening lending practices from financial institutions. As buyers retreat, the dynamics of the market shift from vibrant potential to an uphill climb.

    Questions & Answers

    What factors are influencing the slowdown in Bangkok’s condo market?
    Developers are facing a range of pressures, including a recent earthquake’s psychological impact, ongoing economic uncertainties, high household debt, and stricter mortgage lending criteria, all contributing to reduced buyer confidence.

    How does the current supply of new condos compare to previous years?
    The supply of new condominiums in Q2 2025 reached its lowest level in 15 years, with only 405 units launched, a significant downturn from the market peak in Q2 2022 when over 15,000 units became available.

    What strategies are developers implementing to cope with market challenges?
    Many developers are pivoting to proactive strategies, which may involve price reductions or special sales to stimulate sales and manage cash flow effectively as they navigate through ongoing market uncertainties.

  • Bangkok’s Real Estate Market Poised For Resilience Amid Economic Uncertainty

    Bangkok’s Real Estate Market Poised For Resilience Amid Economic Uncertainty

    According to a recent JLL report, six new projects are poised to make their debut in the Bangkok market by 2025, boasting an impressive average presales rate of 70%. However, most developers are adopting a conservative stance, prioritizing inventory clearance and delaying new project launches until market confidence sees a rebound.

    Market Dynamics: Rentals on the Rise

    “In the near term, rental rates are expected to surge due to high loan rejection rates, with renters increasingly leaning toward the security and flexibility that rentals provide,” the report elaborated. Despite the optimistic rental outlook, capital values are projected to rise more slowly, held back by cautious investor sentiment. Market yields are anticipated to stabilize at 5.2% through 2025, indicating a steady, albeit slow, growth trajectory.

    Quarterly Recovery in Luxury Condos

    Bangkok’s luxury condominium sector is witnessing a slight recovery, with the second quarter showing signs of resurgence, spurred by interest rate cuts and relaxed loan-to-value (LTV) measures. This bounce-back has allowed the market to return to pre-pandemic levels, although challenges remain from the economic downturn and reciprocal tariffs imposed by the US.

    Prime Apartments: A Hot Market

    Prime apartments are maintaining strong traction, with half of the total inventory achieving full occupancy during the last quarter. Vacancy rates have now fallen for two consecutive quarters, decreasing by 51 basis points to 4.2%, largely driven by corporate relocations.

    Economic Uncertainty and Its Effects

    Despite the emergence of positive trends, the luxury condominium inventory has remained steady at 72,500 units, with no new completions noted for the second quarter. Economic uncertainties have led buyers to postpone their decisions, prompting developers to be particularly prudent regarding future launches.

    Expansion of Prime Apartment Stock

    The prime apartment sector saw its stock grow to 4,700 units in Q2 2025, thanks to the addition of 39 Luxury Suites. This bolstered the Central East submarket’s status as the go-to location for prime living spaces in Bangkok.

    The Rental Market’s Continuing Surge

    Capital values have ticked up by 1.5% quarter-on-quarter, reflecting a moderate growth tempered by broader economic challenges. With demand soaring from both domestic and international renters, gross rents have risen to THB 757 per square meter per month, marking the thirteenth consecutive quarter of growth at an impressive 4.0%. This strong performance in the rental market has nudged market yields up to 5.2%, showing that sometimes economic upheaval can lead to surprising opportunities.

    Questions & Answers

    What is the average presales rate for new projects in Bangkok?
    The average presales rate for the expected six new projects by 2025 is 70%.

    How has the luxury condominium market in Bangkok performed recently?
    The luxury condominium market saw slight recovery in Q2, thanks to interest rate cuts and relaxed loan-to-value measures, bouncing back to pre-pandemic levels.

    What trends are emerging in the rental market?
    The rental market has experienced strong demand with gross rents growing for the thirteenth consecutive quarter, increasing by 4.0% to THB 757 per square meter per month.

  • New Zealand Eases Property Ownership Rules for Foreign Investors: What It Means for the Market

    New Zealand Eases Property Ownership Rules for Foreign Investors: What It Means for the Market

    In a significant policy shift, New Zealand is set to open its doors to affluent foreign property investors, marking the end of a seven-year ban. This ban was initially implemented by the center-left government of former Prime Minister Jacinda Ardern in 2018 to combat skyrocketing housing prices attributed to a surge in immigration and a pronounced lack of housing availability.

    While Australians and Singaporeans were exempt from the restrictions due to existing trade agreements, the newly unveiled regulations allow holders of the Active Investor Plus residency visa to purchase or build homes valued at NZ$5 million (approximately USD$2.95 million). This change is set to take effect by the end of the year and aims to strike a balance between those desiring to restrict foreign ownership and the ambition to attract wealthy investors.

    Prime Minister Christopher Luxon reported that since the visa’s launch in April, over 300 applications have been submitted, all requiring a minimum investment of NZ$5 million within three years. “The price threshold methodically navigates a path between those who do not want foreign ownership opened up and the desire to lure high-net-worth investors,” he explained.

    Interestingly, New Zealand’s geographical remoteness — once seen as a disadvantage — has transformed it into a coveted retreat for ultra-rich individuals seeking an exclusive escape. The tale of billionaire Peter Thiel, founder of Paypal and a U.S. President Donald Trump supporter, illustrates this allure. After becoming a citizen in 2011, Thiel planned an extravagant private estate but became embroiled in controversy when it emerged he had only spent a mere 12 days in the country.

    Despite a 30% surge in property prices in various regions during the pandemic, values have since declined over the past two years. Nonetheless, the housing supply remains constrained, leaving many New Zealanders struggling to secure home ownership.

    Questions & Answers

    What prompted New Zealand to relax its restrictions on foreign property ownership?
    The relaxation stems from a desire to attract wealthy foreign investors, balancing the interests of New Zealanders who support restrictions on foreign ownership with the potential economic benefits of attracting high-net-worth individuals.

    How much must foreign investors invest to qualify for the Active Investor Plus residency visa?
    Foreign investors need to invest at least NZ$5 million (roughly USD$2.95 million) over a span of three years to qualify for the visa, which allows them to purchase or build property in New Zealand.

    What has been the trend in New Zealand’s housing market recently?
    Following a significant price increase of over 30% during the pandemic, housing prices have fallen over the past two years, but the country continues to struggle with tight housing supply, making home ownership elusive for many locals.

  • Discover the Asian City Where Home Prices Are Reaching New Heights!

    Discover the Asian City Where Home Prices Are Reaching New Heights!

    As the retail landscape in Asia continues to evolve, major players are adapting with innovative strategies to capture consumer attention. One such shift is occurring in Singapore, where Sephora has announced a unique partnership with Singapore Airlines. This delightful collaboration promises to enhance the in-flight experience for passengers, who will soon be able to shop for exclusive beauty products directly through their IFE (in-flight entertainment) systems.

    Sephora’s New Adventure in Travel Retail

    Sephora, known for its vibrant storefronts and vast selection of beauty products, is taking its commitment to customer engagement to new heights—literally. By joining forces with Singapore Airlines, the beauty retailer aims to tap into the lucrative travel retail sector, allowing passengers to browse and purchase products mid-flight. This initiative not only diversifies Sephora’s market reach but also serves to transform the airborne shopping experience into something that could soon rival that of a luxurious beauty boutique.

    A Win-Win for Travelers and Beauty Enthusiasts

    The partnership will give passengers access to exclusive product lines available only on flights, meaning your favorite red lipstick might not just stay in your suitcase anymore. With the potential for in-flight beauty tutorials and product showcases, travelers can look forward to engaging with the latest trends in cosmetics while comfortably seated at 30,000 feet. It’s almost like having a Sephora store in the sky—talk about high-flying glamour!

    The Broader Implications for the Retail Sector

    This collaboration represents a significant trend in the retail industry, where partnerships between travel and retail brands are becoming increasingly common. As air travel continues its recovery post-pandemic, strategies that enhance passenger experiences will be vital. Sephora’s move also highlights the larger shift toward personalized shopping experiences, a trend that is poised to resonate with an increasingly discerning consumer base across Asia.

    What Lies Ahead for Beauty Retail

    As beauty retail continues to innovate, this partnership is emblematic of how brands can create new touchpoints with consumers in midair. Retailers are not just competing on the ground anymore but are also looking for ways to elevate the shopping experience beyond traditional storefronts. In this dynamic environment, brands must stay nimble and creative to capture the hearts and wallets of consumers.

    Questions & Answers

    How does the Sephora and Singapore Airlines partnership benefit passengers?
    Passengers will soon be able to shop for exclusive beauty products directly through the in-flight entertainment system, enhancing their travel experience with luxury brands at 30,000 feet.

    What makes this partnership significant in the retail landscape?
    This collaboration highlights a growing trend where retail brands are innovating their engagement strategies by partnering with travel-focused companies, thus creating unique shopping experiences for consumers.

    What can we expect from in-flight shopping in the future?
    As travel resumes, we can anticipate more brands following suit to provide exclusive products and personalized experiences that cater to onboard passengers, making shopping a journey of its own.

  • Downtown HCMC Retail Rents Soar to $300 per Square Meter: What It Means for Shoppers and Retailers

    Downtown HCMC Retail Rents Soar to $300 per Square Meter: What It Means for Shoppers and Retailers

    In a recent overview of Ho Chi Minh City’s retail landscape, property consultancy Avison Young highlighted that the minimum rent in the downtown area remains stable at $45 per square meter for the second quarter, unchanged from the previous quarter. Luxury shopping destinations have seen significantly higher rates; Saigon Centre and Vincom Center Dong Khoi charge rents between $200 and $250, while Times Square tops the charts at $300 per square meter.

    In sharp contrast, retail spots in non-central neighborhoods only fetch $20 to $117, illustrating the premium placed on properties in the bustling city center. Yet, despite these steep prices, foot traffic in downtown areas remains robust, with occupancy rates soaring to 96% in the heart of the city and 86% in outer zones. CBRE corroborated these figures, noting that only 5% of retail space is unoccupied in prime districts and 8% elsewhere.

    David Jackson, CEO of Avison Young Vietnam, attributed the upward pressure on rents to an influx of global brands setting up shop in the city. American coffee giant Starbucks has recently increased its footprint, opening a new outlet at the Bitexco tower and securing additional space at Diamond Plaza. Meanwhile, Japanese retail giant Uniqlo is also moving into the market with a new store at Vincom Le Van Kiet, further indicating the growing international interest in Ho Chi Minh City.

    Popular malls like Saigon Centre and Vincom Dong Khoi continue to shine, boasting impressive occupancy rates between 98% and 100%. Jackson noted that with limited new supply coming to market, these established retail spaces are leveraging their prime locations to maintain high occupancy levels. Fashion and food-and-beverage brands are particularly strong in leasing, especially in vibrant, high-traffic areas.

    The evolving landscape of retail has heightened the importance of consumer experience, with the design and layout of spaces, integrated amenities, and after-sales services gaining traction as critical factors influencing rental prices. Mai Vo, director of retail services at CBRE HCMC, remarked on the surge of Chinese brands such as Oh!Some and Polarpopo entering this dynamic market.

    Responding to these trends, mall developers are reimagining tenant layouts, merging smaller units into larger spaces to accommodate burgeoning lifestyle brands. This transformation aims to turn shopping centers into “one-stop shops,” providing an array of services and amenities to enhance the overall customer experience.

    Looking ahead to the latter half of 2025, Vo anticipates the addition of around 25,000 square meters of new retail space within two central projects, signifying ongoing growth in Ho Chi Minh City’s retail sector. As consumers become increasingly discerning, often researching prices and seeking out deals, retailers are being pushed to adopt omnichannel strategies, blending digital and in-store experiences to capture this elusive market.

    Questions & Answers

    What are the current rental rates in Ho Chi Minh City’s downtown area?
    The minimum rent in the downtown area is $45 per square meter, with high-end shopping centers charging significantly more, ranging from $200 to $300 depending on the location.

    How are occupancy rates in Ho Chi Minh City’s retail spaces?
    Occupancy rates are notably high in the downtown area, reaching 96%, while non-central areas show an occupancy rate of 86%, indicating a robust demand for retail space.

    What strategies are mall developers employing to attract customers?
    Mall developers are restructuring tenant layouts by combining smaller units into larger ones to better accommodate lifestyle brands, aiming to transform shopping centers into integrated hubs that enhance customer experiences.

  • Bangkok Condo Supply Hits 16-Year Low, Signaling Major Shift in the Real Estate Market

    Bangkok Condo Supply Hits 16-Year Low, Signaling Major Shift in the Real Estate Market

    Thailand’s property market is navigating a turbulent landscape, with new condo launches plummeting by a staggering 94% year-on-year, resulting in only 373 units introduced in the first half of the year. This downturn marks the lowest level since 2009, a year when the market was still shaking off the effects of the subprime mortgage crisis, surpassing even the declines experienced during the peak of the Covid-19 pandemic, according to a recent report by property service firm Colliers Thailand.

    This alarming trend has prompted a crucial reassessment of strategies among property developers and market analysts alike. “This is not merely a seasonal slowdown but rather a pronounced reflection of buyer hesitation and a cautious approach from developers,” stated Pattarachai Thaweewong, director of research at Colliers International Thailand. He emphasized that, despite a slight uptick in the market between 2022 and 2023, there is still a long way to go before it regains its pre-crisis momentum.

    The downturn in 2025 is particularly stark when viewed against the historical backdrop, where the second quarter typically sees an average of 8,000 to 12,000 new condo launches each year. The supply crisis has persisted from the previous quarter, evidenced by the installation of 6,306 new condo units in Bangkok—an impressive 72% increase compared to last year, but a troubling 35% decline from the fourth quarter of 2024, as reported by Bangkok Post.

    Thaweewong attributes this substantial drop to several key factors: high interest rates are significantly impeding the purchasing power of genuine buyers, while rising costs for construction materials and land are squeezing developer profit margins. Furthermore, ongoing economic uncertainty paired with an unclear government policy direction continues to erode confidence in the market.

    In light of these challenges, many developers are opting to delay new project launches, shifting their focus towards mitigating existing inventory while bolstering cash flow—a prudent but perhaps surprising strategy in a market where fresh launches are typically anticipated. Interestingly, as the Bangkok market cools, property developers are pivoting towards Thailand’s vibrant southern island, Phuket. This shift aims to capitalize on the burgeoning demand from tourists and retirees primarily from China and the U.S.

    Colliers reports that around 10,000 new flats are set to hit Phuket’s market this year, with new project launches taking place weekly, creating a scenario reminiscent of a frenetic game of real estate Tetris, as developers scramble to align their offerings with market demand, as mentioned by South China Morning Post.

    Questions & Answers

    What caused the significant decline in new condo launches in Thailand?
    High interest rates, escalating development costs, and ongoing economic uncertainties are primary factors leading to buyer hesitation and developer caution.

    How does the current condo launch situation compare to previous years?
    The current figures show a 94% year-on-year decline, marking the lowest level of new launches since 2009, significantly less than the second quarter average of 8,000 to 12,000 launches seen over the last decade.

    Where are developers focusing their efforts amid the downturn in Bangkok?
    Developers are increasingly targeting Phuket, with plans for around 10,000 new flats this year, catering to rising demand from tourists and retirees from abroad.

  • Taxing housing necessary but challenging

    Taxing housing necessary but challenging

    Experts say that taxing housing will help make the real estate market more transparent and prevent speculation, but it is necessary to digitize data, ensure fairness, and avoid overlapping taxes.

    The government plans to enact a new law on real estate taxation in place of the Law on Agricultural Land Use and the Law on Non-Agricultural Land Use, and separating houses and land for tax purposes.

    There is currently a very low tax on lands and, unusually for any country, none on houses.

    The Government is on course to submit the bill to the National Assembly for comments in October 2024 and approval in May 2025.

    Several experts said they agree that taxing houses and lands is necessary in the context that the property market is opaque and plagued by speculation, lack of systematization and ineffective management.

    Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association, said taxing housing and land would help make the real estate market fairer and more transparent.

    Nguyen Van Duoc, general director of Trong Tin Accounting and Tax Consulting Company, supported an increase in the tax rates on lands but warned it is necessary to safeguard the interests of the public and not adversely affect the market.

    “Taxing houses and other construction is also reasonable. Many countries around the world have done it for a long time.”

    Nguyen Mac Hoai Nam, general director of Nam Phat Investment Consulting Company, said tax policies often have a direct and almost immediate impact on investment behavior, speculation and buying and selling of properties.

    He explained that taxing houses and lands would enable authorities to monitor the market closely, increasing its transparency and making policymaking and management more efficient.

    But analysts also warned there would be many challenges in doing this.

    Duoc pointed out that taxing depends on databases and the capability of management agencies.

    Chau said to tax houses and other properties, it is necessary to reduce land-use fees to avoid excessive taxation.

    The land-use fee is collected once and not annually and accounts for 10% of the value of an apartment and 30% of a townhouse.

    In the case of villas, it accounts for 50%.

    If land-use fees remain high, the addition of property tax would make the burden excessive, he said, pointing out that developed countries collect house and land taxes annually.

    Nam suggested starting taxes on housing and land at moderate rates and then gradually increasing them so that people could get used to it.

    “It is also necessary to consider lowering the land-use fee.”

    First, government agencies need to get comprehensive data on housing and lands and come up with a convincing valuation method for the taxes.

    The data should be collated in time to ensure the new law is passed by mid-2025.

    Huynh The Du, a lecturer in public policy at Fulbright University Vietnam, said the database cannot be completed anytime soon.

    The country has over 27 million households living in more than 2.5 billion square meters of housing, but data on their prices is scant and many houses have not been traded for decades, he pointed out.

    In any case, the prices registered during transactions are much lower than market rates, he further pointed out.

    Dang Hung Vo, a former deputy minister of natural resources and environment, said the government should not rush to tax houses and apartments, but focus on taxing lands.

    This is more feasible because the country has an established land management system, he said.

    Urban residential lands are managed relatively well, and so taxing them is easy and efficient, he said.

    Meanwhile, it is necessary to perfect the system for assessing land prices to ensure they are close to market rates.

    “This is the first step before thinking about taxing houses.”

    It is difficult and complicated to tax housing due to the lack of an effective management system, he said.

    Analysts said local governments should collect the housing tax for investing in infrastructure and utilities like bridges and roads and planting trees.

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  • Multi-million dollar apartments catch super-rich’s eyes

    Multi-million dollar apartments catch super-rich’s eyes

    Wealthy people are splurging millions of dollars to buy ultra-luxury apartments mostly as second homes. Hoa, owner of a house and a villa in HCMC’s Thu Duc City, said she recently bought a VND30-billion (US$1.3 million) apartment.

    Located on the 27th floor of a luxury project, the 200-square-meter unit offers unobstructed views of the Saigon River.

    It had four bedrooms, but Hoa took one down to expand the kitchen and living space.

    She topped it off with bespoke interiors at a cost of over VND5 billion, including a VND1 billion lighting system imported from Italy, two exotic paintings that cost hundreds of millions of dong and a $20,000 speaker system.

    It took her over a year to finish decorating, she said.

    “The apartment’s beautiful views, convenient car parking and relaxing atmosphere make it the ideal place for me to entertain friends and guests,”

    A broker has asked to buy her apartment for VND35 billion, but she refused.

    “I want to keep it for myself,” she said.

    Truong, an experienced investor, bought a penthouse in the heart of District 1 as a second home besides his 300 sq.m villa in the south of the city.

    The 200-sq-m unit cost him VND25 billion and another VND8 billion for decoration and interiors, he said.

    “I spent VND33 billion on this unit because of its amenities, security and views. I can watch firework displays right from here, something that townhouses and villas cannot provide.”

    Rising trend

    Luxury apartments have recently become very popular with successful businesspersons, NeloDécor, an architecture and interior design firm specializing in high-class properties, said.

    The company has just finished decorating a $2-million sky villa for an entrepreneur for VND12 billion.

    Previously it designed and built the interiors for a penthouse for an affluent family, which cost $2.5 million to complete and another $1 million for interiors and smart devices.

    It is not uncommon for affluent people to spend $1-2 million for buying an apartment in the central business district and hundreds of thousands or millions of dollars more for decorating and doing the interiors, NeloDécor CEO Le Duy Van said.

    They are mostly super rich and already own multiple properties, and so have extensive demands, he said.

    Amenities, security and views are key factors for them while choosing to buy, he said.

    Most of them hire designers, but some design on their own, and are ready to knock down and rebuild multiple times until they are happy.

    Pham Lam, CEO of property consultancy DKRA Vietnam, agreed that demand for luxury apartments is rising.

    In some cases, properties serve the same purpose as expensive jewelry and supercars, he said.

    Rising supply

    Consultancy Cushman & Wakefield expects supply of luxury apartments in HCMC to rise this year, especially in the central business districts and Thu Thiem Peninsula.

    Their prices will surge, too, with new projects constantly rising to record levels, it said.

    Average price tags for luxury apartments surged by 23 percent year-on-year to VND143.6 million per square meter in the last quarter of 2021. For ultra-luxury properties, they went up to VND400 million.

    Eddie Lim, CEO of real estate developer Viva Land, said the number of rich people in Vietnam is rising faster than the global average.

    Vietnam is expected to have 1,551 ultra-high net worth individuals (UHNWIs) by 2026, compared to 1,234 last year, according to an estimate contained in a Wealth Report released by U.K. property consultancy Knight Frank.

    The company also predicts that the number of rich people, or those with a net worth of $1 million or more, including their primary residence, will rise sharply by more than 59 percent from last year to 114,807 in 2026.

    The Vietnamese luxury apartment market is also promising for foreigners, especially rich Asians, thanks to the country’s rapid economic growth and more competitive pricing than Singapore, Hong Kong, Japan and China.

  • More Headwinds for Bangkok’s Already Hollowing Condos

    More Headwinds for Bangkok’s Already Hollowing Condos

    There are an estimated 100,00 vacant condominiums in and around Thailand’s capital as a plunge in Chinese demand hits the property sector.

    Foreign buyers accounted for one-fifth of the Bangkok’s real estate purchases two years ago, according to estimate from local consultancy Agency for Real Estate Affairs, but the ongoing coronavirus outbreak is set to cut the figure in half. This is especially due to the fact that the majority of foreign demand is from Chinese buyers who are being hindered by travel curbs in addition to economic risks at home.

    The projections if materialized will further exacerbate damage being felt in Bangkok’s real estate market especially in the condominium segment where the consultancy estimates up there are up to 100,000 vacant units.

    In addition to the real estate sector, Thailand’s broader economy was already feeling the pressure in 2019 from a strengthening baht and an ongoing U.S.-China trade war. Gross domestic product growth is projected to grow as little as 1.5 percent in 2020 – a six-year low – according to the government.

    Local authorities are already rolling out measures to support the property market including loosened mortgage lending rules from the Bank of Thailand to encourage domestic purchases. Still, the outlook remains gloomy and a report citing an estimate by global real estate consultant Collier places the number of newly developed condo units at 6,000 in the first quarter of 2020, a 40 percent year-on-year drop.

    To date, the coronavirus outbreak has infected nearly 80,000 individuals with a kill count of 2,495.

  • Vietnam cuts size limit for apartments to reach low-income buyers

    Vietnam cuts size limit for apartments to reach low-income buyers

    The construction ministry has approved a developer’s request to build 25-square-meter apartments. Vietnam’s Ministry of Construction has given the go-ahead for a real estate developer to build apartments as small as 25 square meters (270 square feet) to attract low-income earners.

    The ministry’s Housing and Real Estate Market Management Department, in a letter issued late last month to a domestic developer, said the firm would be allowed to build 25-square-meter apartments before the ministry sets new national standards for apartment sizes.

    Vietnam’s construction law from July 2015 abolished a previous requirement that set the minimum area for an apartment at 45 square meters, but did not stipulate a new limit.

    In December 2015, a government decree on developing houses for low-income earners came into force and set the minimum area at 25 square meters. Decrees often requires guidance from related ministries before they are implemented.

    Construction businesses and provincial authorities have been seeking permission to build commercial houses of 30-40 square meters to attract individuals, small families and low-income buyers, and the permit has been granted given the huge demand, the construction ministry said.

    Binh Duong Province, an industrial center neighboring Ho Chi Minh City, last year launched 5,000 apartments as part of its housing program for low-income people, and has started construction of another 10,000 units.

    Vietnam currently has 2.2 million people working in industrial parks, but only 20 percent of them have their own homes, according to the construction ministry.

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  • Indonesia plans emergency law to let foreigners buy apartments

    Indonesia plans emergency law to let foreigners buy apartments

    Property sector needs reform to attract investments, says minister. Indonesia plans to issue an emergency law – known as a perppu – to break an impasse of more than a decade in efforts to streamline unfriendly laws as the country aims to allow foreigners to purchase apartments in Indonesia.

    The government had in the past repeatedly tried to move forward and set regulations to allow foreigners to own apartments in South-east Asia’s biggest economy.

    But they were never able to get these implemented because the basic stipulation under Indonesia’s 1960 Agrarian Law is that foreigners just cannot own homes in the country, Coordinating Minister for Political, Legal and Security Affairs Luhut Pandjaitan said.

    “But the era has changed now. The property sector needs a reform so we could attract foreign investment. Foreigners should be allowed to buy apartments – but not landed houses – even if they don’t hold Kitas (Indonesia’s residence permit),” Luhut told The Straits Times.

    “It is similar to that in Singapore,” he added.

    Indonesia’s Constitution gives the President the right to issue a rule in lieu of law (perppu) when he determines that an emergency in the country requires it.

    A perppu is immediately effective after the President signs it, and Parliament can either let it remain effective or end it within a year after the perppu is issued.

    Luhut said the perppu that covers a new rule allowing foreign investors to buy apartments is one of between four and five perppu that Indonesia plans to issue by August, to resolve other obstacles hindering the government reform programme.

    “This is a revolutionary step to address such problems,” he said.

    A so-called debottlenecking working committee has been set up to identify problematic and protracted clauses in all laws.

    “We will comb all legislations that overlap with each other,” Purbaya Yudhi Sadewa, who heads the working committee, told The Straits Times.

    The perppu will supersede only the problematic clauses in each law and serve to bypass them, Luhut said.

    He added that one perppu could address problems in five to more than 10 existing laws, and about 80 per cent to 90 per cent of the existing laws can be harmonised.

    Issuing perppu is a normal practice that some foreign governments, such as the United States, also use, Luhut said, adding that the term used in the US is “presidential Act”.

    In May, President Joko Widodo signed a perppu that allows courts to increase penalties for sex crimes, which include for the first time chemical castration and death sentence, after the media highlighted a growing number of attacks against children.

    Previously, the maximum sentence for a child sex offence was 15 years’ jail. Indonesians have mostly welcomed the move.

    Amending existing laws through the normal process, by proposing Bills to Indonesian Parliament, can drag on for several years, and in some cases, proposed Bills were thrown out.

    Numerous government reform programs in Indonesia in the past decades have hit a snag due to conflicting laws that need amendment.

  • The Golden Rules to Buying the Best Resale Value Condo

    The Golden Rules to Buying the Best Resale Value Condo

    As you look into the condo market in Malaysia, always keep in mind that you should exercise utmost care. Remember, that although a condominium may appear aesthetically stunning and neat from the outside, some condo buildings are dens of problems arising from poor construction to mismanagement and unexpected repairs left unattended due to a lack of reserve funds. To avoid buying into such a property, here are a few golden rules if you are looking to invest in a condo as an investment vehicle or residence.

    Do Not be Rushed to Buy a Condo

    Buying on impulse is part of human nature, especially when people see something that look good. They will usually make a purchase before making a thorough inspection of the item they are buying, later to discover defects the seller was not aware of or failed to mention. Likewise, if you are an overeager condo buyer, you are likely to run into problems when you rush to complete the transaction without thoroughly examining the unit.

    People rushing to buy a condo are more likely tempted by:

    • The allure of becoming homeowners
    • Sales pitches pressure and developer promises that are too lofty
    • Not realizing that owning an apartment does have its problems
    • Not understanding what communal ownership entails

    Beware; There are Condo Bargains that Come With High Fees 

    If you find a condo unit selling at rock bottom price, but with unusually high fees, think twice before negotiations start. Some troubled condo complexes will sell their units for cheap rates due to poor construction or mismanagement, often also due to real-estate market drop. Such complexes deplete their reserve fund to cover repairs and maintenance. They will compensate for their low selling prices by charging higher than usual monthly maintenance fees.

    Avoid Low Down Payments

    To enjoy lower mortgage and associated monthly payments and enjoy greater chances of refinancing in the future, put more money in as down payment. Avoid advertisements that allow you to make down payments as low as 3 percent. Low down payments require that borrowers pay an extra fee for mortgage insurance which can add up to thousands of ringgits making the purchase that much more expensive.

    The best down payment should be of about 25 percent the value of the condo, and this will not attract private insurance fees. In addition, this will protect you from mortgage renewal should interest rates increase or your unit’s value decreases on the market. If a unit value drop during mortgage renewal, your only choice is to apply for a high-ratio mortgage using equity in your property – your initial down payment.

    No matter the size of your down payment, make sure it is not borrowed. Ideally, it should be from your savings. Borrowing cash for a down payment is risky since it create inequity in your budget and can place you in a risky position, much like those buying condos at low down payments. Remember the following:

    • If you do not have a solid down payment, do not commit to buy
    • Money should not be borrowed for down payment
    • A solid down payment should be from your savings, wait till you have enough
    • There are always great opportunities to own property at Property Guru. The longer you wait, the better you choice will be

    Verify the Physical Facts 

    Inspect your prospective condo unit carefully, especially the well-being of the complex. Each complex is different depending on its builder and developer. Construction quality also varies. Verify the reputation and experience of the complex builder. When buying into an existing property at Property Guru, find out from the residents if there have been any unexpected repair problems recently and whether they anticipate future repairs.

    Take note of utility billing. If each unit is billed separately, you will have more control over the energy you consume and monthly expenses. While some complexes are self-managed, others are run by contracted management companies. If the latter is true in your case, investigate the management company to establish their reputation.

    To conduct checks, hire a qualified home inspector and an attorney. If the complex is poorly constructed or managed, you will be glad that you spent the money.

    You have to consider all the facts carefully before you make any form of commitment in what may be the biggest investment you make. Take a deep breath, if necessary; sleep over your decision for a few days. Otherwise, you might succumb to developer or real estate broker pressure as they seek to make a sale for a commission.

    In addition, do not let others make the decision for you. Read the rules above for days and even weeks. When you adhere to them, you will develop the buying skills that will enable you make educated decisions before putting your signature to paper.

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