Identifying the focal points of remittance flows in early 2024

"Bright prospects" in the real estate investment channel.

Despite the overall impact of the global economy, in 2023, remittances from overseas Vietnamese helped Vietnam maintain its position as one of the top 3 countries receiving the most remittances in the Asia-Pacific region and one of the top 10 countries with the largest remittances in the world. According to World Bank forecasts, remittances to Vietnam in 2024 are expected to be even higher than in 2023, estimated at US$14.4 billion.

According to Mr. Peter Hong, Permanent Vice President and General Secretary of the Association of Vietnamese Businesspeople Abroad, there are currently about 6 million Vietnamese expatriates, of which about 10-12% are entrepreneurs and intellectuals with high qualifications and incomes, who have a need to own real estate in their homeland to visit family or to stay, live, work, invest, and do business, thus maintaining a connection with their homeland.

For Vietnamese expatriate entrepreneurs and intellectuals, investing in real estate in Vietnam not only creates stability and security but also offers significant profit opportunities.

The diversity of Vietnam's real estate market, including shophouses, luxury apartments, and resort villas, offers a wide range of choices for overseas Vietnamese investors. Furthermore, a stable political environment, a recovering macroeconomic economy, a favorable investment environment, and high growth potential are crucial factors contributing to the increased inflow of remittances into the domestic real estate market.

This segment is highly sought after by ultra-wealthy Vietnamese expatriates.

In the overall context, Nghe An has emerged as a bright spot for overseas Vietnamese investment because it leads the country in the number of workers going abroad under contract, with remittances reaching approximately US$650 million annually, equivalent to VND 15,000 billion. If we include the number of workers going abroad independently through other channels, which is over 20,000, the annual remittances sent back amount to approximately US$1.4 billion, equivalent to nearly VND 35,000 billion.

Vietnamese expatriates from Nghe An province, with their tendency to invest in the real estate market in their homeland, are contributing to the increased demand for certain particularly promising product lines, with business and profit potential comparable to other projects in major markets nationwide.

For example, earlier this year, the investment story of a well-known figure among Vietnamese Americans, the first person to own a McLaren supercar in Nghe An, caused a stir in the Nghe An real estate market. Information indicates that this Vietnamese expatriate from Dien Hanh commune, Dien Chau district, Nghe An province, recently added five shophouses to his real estate portfolio in the Hoang Son Urban Area, elevating the status of the project, dubbed "the promised land for Vietnamese expats worldwide."

Commenting on this decision, investors quickly recognized the underlying strategy, as the Hoang Son Urban Area had entered a stable operational phase, generating a steady stream of income for business investors. It can be said that the shophouses in the project perfectly meet the needs of seasoned investors, possessing a prime location on National Highway 7 – a connecting route to the North-South Expressway – while also offering the full functionality of a shophouse for immediate rental and business income generation, and currently being in a "golden period" for investment growth.

With the upcoming official implementation of the amended Land Law, the expansion of land use rights for Vietnamese people residing abroad will contribute to increasing the attractiveness of domestic real estate. At that time, the shophouse segment is predicted to "boom" and become a focal point for the entire market.