CBRE Vietnam MarketView Q4 2017

 Vietnam GDP              HCMC GDP            Hanoi GDP                VN-Index
          6.81% y-o-y                      8.30% y-o-y                    8.48% y-o-y                      48.03% y-o-y

*Arrows indicate change from the same period of the previous year.

  • 2017 wrapped up with solid fundamental indicators. GDP growth reached 6.81% and stayed in the top ranking amongst other Asian countries. FDI rose 44% y-o-y, VN Index reached a 10-year high by the end of 2017, inflation was at 3.53%, while GDP per capita reached US$2,385 (an increase of 7.7% y-o-y). However, some concerns were raised regarding productivity of the labor force, especially in comparison with neighboring countries.
  • Condominium market: 2017 ended with a busy quarter in both Hanoi and HCMC, with 9,500 units launched in Hanoi and 8,559 units launched in HCMC in Q4. Total new launch in 2017 for Hanoi and HCMC was estimated at 35,000 and 31,106 units respectively. Market sentiment continued to be positive for both cities, with 23,000 and 32,905 units sold in Hanoi and HCMC respectively. In 2018, the market is expected to focus more on the mid-end segment, with nearly 53% of 2018 new launch units in this segment.
  • Office market: Office market welcomed seven new buildings in Hanoi and five new buildings in HCMC in 2017. Rents in Hanoi increased for the first time in the last five years in both Grade A and Grade B, while HCMC rents continued to have slight increase.  Looking forward to 2018, banking/insurance, manufacturing and IT, especially co-working space is expected to be a potential source of demand.
  • Retail market: The retail market had a busy year with two new projects in Hanoi and seven new projects in HCMC, leading to both entries of foreign retailers and expansion of current players. Within the next three years, retail market will be more competitive as a large amount of supply from community retail podium will be launched. Ecommerce, which had recently got much attention from investors and consumers, is expected to develop quickly in Vietnam.