Although the real estate market has had many positive changes, the resort real estate segment has not recorded many positive signals.
Resort tourism real estate still has many difficulties
The Government’s open policies for the tourism industry in recent years have created favorable conditions for domestic tourism to develop, towards a full recovery of tourism activities as before Covid-19.
Data from the General Statistics Office (Ministry of Planning and Investment), international visitors to Vietnam in December 2023 reached nearly 1.4 million, up 11.2% over the previous month and up 93.9% over the same period last year. For the whole year 2023, Vietnam’s tourism will welcome 12.6 million international visitors – 3.4 times higher than 2022, far exceeding the target of 8 million visitors.
Besides, the market has had many positive changes in both total supply and aggregate demand. However, the recovery of the tourism industry associated with resort real estate development is still difficult due to many factors such as legal, administrative procedures and opening up capital sources.
According to information on the real estate market from the Ministry of Construction, in the fourth quarter of 2023, the selling price and volume of resort real estate transactions continue to decrease and restrictions on transactions. The number of resort villas launched for sale in the South (Ho Chi Minh City and surrounding areas) decreased sharply and the number of tourist apartments launched in 2023 across the country decreased compared to 2022.
The selling price of tourism and resort real estate products in the quarter also tended to flatten and decrease slightly, some new projects had asking prices.
According to the recent real estate market report of the Vietnam Association of Real Estate Brokers (VARS), in the fourth quarter of 2023, the market has been more bustling by the running of information of a number of projects, kick-off programs, large-scale launches that were absent in previous quarters.
However, the resort real estate segment is the segment that recorded the heaviest impact, up to now, it has still fallen into “long slips”.
Although rekindling the opportunity to “regenerate” thanks to the Government’s Decree 10/2023, with this segment, data shows that in the fourth quarter of 2023, there are about 913 new products put on the market, equivalent to the supply in the third quarter of 2023 and only 30% compared to the same period last year.
The main supply is sea apartment products, scattered in the North, Central and South areas such as in Quang Ninh, Phu Quoc, Da Nang… The supply did not meet expectations, in which, the main reason was that some large-scale projects had to temporarily suspend opening for sale because of legal problems.
What does the future hold?
Experts said that in the coming time, it is necessary to pay special attention and study mechanisms and policies for synchronous development of the tourism industry to hope to regain the trust of customers/investors in the resort real estate segment.
Some experts stated that hotel business still faces many challenges, negatively affecting the recovery of demand in some localities. However, many solutions to retain and attract tourists are applied along with positive signals about demand in the last months of the year and new visa policies are expected to be the growth engine for resort real estate this year.
Ms. Pham Thi Mien, Deputy Head of VARS Market Research and Investment Promotion Consulting Department, said that this year supports the recovery and development opportunities of the tourism industry. That is, the visa relaxation policy continues to work along with the 2% tax reduction policy for the group of goods and services and many support promotion programs and tourism exhibitions are held.
According to her, these factors will be the motivation for investors to accelerate the progress, “pump” supply into the market, the supply of resort real estate will have the opportunity to improve with about 20% compared to 2023.
Besides, according to Ms. Mien, the type of beach apartment will be the highlight of the segment because it both meets the needs of ownership, can be exploited for rent and create cash flow.
In particular, Decree No. 10/2023 dated April 3, 2023 dismantles the issuance of pink books for types of real estate apartments, resorts, offices combined with resorts… The coming time will have a certain permeability, creating hope for investors and investors.
Mauro Gasparotti, Director of Savills Hotels, said that the oversupply of resort real estate stems from the creation of products that do not match market reality. Some investors rush to participate without thorough research, leading to a gap in supply and demand in many areas. In addition, some resort projects also appear to focus on quantity over quality.
According to him, resort real estate has not escaped the gloomy situation, many old projects are behind schedule, construction is delayed, affecting market confidence. Although bank interest rates have fallen, the number of people willing to borrow money to invest is not much, and the “defensive” mentality still prevails.
Therefore, this expert forecasts, by the second quarter of this year, the number of resort real estate transactions is unlikely to have a spike. After this time, the market will improve thanks to the State’s moves to remove legal obstacles through amendments to a number of laws.
