Vietnam’s real estate sector is poised for significant growth in 2025, with the country’s leading contractor, Hoa Binh Construction Group, predicting a substantial recovery in the market. According to Chairman Le Viet Hai, this growth will be driven by the recovery of the real estate and tourism sectors, strong public investment, and increased foreign capital inflows.
Vietnam’s Real Estate Prospects: A Positive Outlook for 2025
Le Viet Hai is optimistic about the prospects for Vietnam’s real estate market, particularly in 2025, as positive changes are already emerging. He attributes much of this optimism to the efforts of the government and key state officials, notably Party General Secretary To Lam, who is determined to streamline administrative procedures and resolve bottlenecks in the real estate sector.
A major indicator of these improvements is the legal resolution for Novaland, one of Vietnam’s top property developers, which has faced challenges in recent years. This development signals a broader governmental commitment to supporting the real estate market and improving regulatory conditions.
Foreign investment is another key factor driving optimism. For instance, Nvidia, the U.S. tech giant, has partnered with the Vietnamese government to set up an R&D and AI data center in the country. This not only promises to boost Vietnam’s IT sector but is expected to have a ripple effect on other industries, including real estate and construction.
Hai also highlights the anticipated recovery of the tourism industry, which is expected to return to pre-pandemic levels in 2025. The return of key international markets, particularly from Russia and Ukraine, will further stimulate demand for tourism-related real estate, benefiting both construction and real estate sectors.
Finally, Hoa Binh Construction is also benefiting from the government’s emphasis on large public investment projects, which will create substantial demand for construction services. Based on these factors, the construction sector is expected to grow significantly in 2025, with a projected increase of 15% from the 7.5% growth in 2024, according to VinaCapital.
Diversification to Mitigate Risks
Hoa Binh Construction has been diversifying its business operations to mitigate risks, particularly after facing significant challenges during the pandemic. Initially, the company concentrated heavily on the resort and tourism real estate sectors, a strategy that aligned with the government’s focus on promoting tourism. However, the pandemic hit this segment hard, severely impacting the company’s ability to secure new projects.
In response, Hoa Binh has expanded into other sectors such as residential real estate, industrial projects, and infrastructure. The company is also exploring opportunities in international markets. Despite these challenges, Hoa Binh’s strategic diversification has allowed it to remain competitive and resilient.
Prospects for Resort, Residential, and Urban Real Estate in 2025
Le Viet Hai believes that while new resort real estate projects may not be launched in the near future, there will be continued work on the completion of ongoing resort projects. This aligns with Party leader To Lam’s push to prioritize the completion of stalled projects, which will help boost economic development and provide much-needed infrastructure.
The residential and urban real estate sectors are also expected to gradually recover, with a focus on resolving regulatory hurdles that have hindered the growth of residential real estate in recent years. The tourism industry’s recovery, coupled with the return of global investors, will contribute to the revival of urban real estate and housing markets in Vietnam.
Overcoming Difficulties: Lessons Learned by Hoa Binh
Hoa Binh has faced several challenges in recent years, most notably the impact of the pandemic, which significantly disrupted its operations. The company’s heavy reliance on the tourism and resort sectors left it vulnerable when the pandemic struck. However, through these difficult times, Hoa Binh learned valuable lessons about risk management, including the importance of ensuring financial stability and diversifying its project portfolio.
Despite the challenging period, Hoa Binh was able to maintain a strong commitment to its workforce, offering training and internal support to employees even when new projects were scarce. The company also forged long-term, strategic partnerships with clients, subcontractors, and suppliers, which has contributed to its gradual recovery.
A Brighter Future Ahead
Looking forward to 2025, Hoa Binh Construction is positioned for significant growth, with several large-scale projects already secured, including developments like Eaton Park and Newtown. The company’s equity has also improved, which will allow it to bid for larger, more lucrative projects.
Hoa Binh expects the construction sector to see a recovery driven by increased demand from the real estate and tourism markets. However, cash flow remains a challenge, and the company is working to address this issue by selling certain real estate assets.
In conclusion, Hoa Binh’s resilience through the pandemic and its efforts to diversify have positioned it for success in the coming years. With the real estate market poised for growth in 2025, the company is optimistic about its future prospects and its ability to capitalize on the recovery of both the real estate and tourism sectors.
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