Vietnam’s leading property developer, Vingroup, recently unveiled Vincity, a brand-new project aimed at providing affordable apartments in seven major cities and provinces throughout the country.
According to Tuoi Tre, Vingroup will launch the project over the next five years, with 200,000 to 300,000 apartments starting at VND700 million (US$30,835) each in Nha Trang, Hai Phong, Hung Yen, Thanh Hoa, Ha Tinh, Hanoi and Saigon.
In an interview with the news source, Vingroup Vice Chairman Le Khac Hiep described Vincity as a “makeover of Vietnam’s suburbs”. According to Hiep, the project reflects the real estate giant’s ambition to form self-sufficient mini-suburbs with schools, stadiums, shopping centers, hospitals and parks while still delivering Vingroup’s values of quality, synchronicity and utility.
In addition, because these apartment complexes are located on the outskirts of the above cities and provinces, they are designed to help reduce urban density and congestion in central areas.
By dabbling in affordable housing, Vingroup has begun to tap into every segment of Vietnam’s real estate market, reports Dat Vang Properties, a conglomerate known for its luxury residential units as well as other investment and business projects.
According to Nikkei Asian Review, Vingroup’s announcement came a month after the government suggested a possible tax on owners of multiple luxury residential units in Vietnam at a time when the market for high-end units has reached saturation.
Meanwhile, the demand of 80% of potential buyers for middle- and low-income housing has not yet been met due to a shortage of affordable housing projects, the news outlet reports.
Due to this imbalance, Vietnam’s government introduced a VND300 trillion (US$13.2 billion) stimulus package in 2012 to steer the real estate market toward affordable housing, according to the World Bank. The organization estimates that Vietnam's urban population will increase 50% by 2040, resulting in demand for at least 370,000 additional units in cities each year.
“Urbanization has been used as a tool to accelerate economic growth and poverty reduction in many countries around the world, and affordable housing will be instrumental to helping Vietnam achieve its goals for increasing productivity and inclusive urban growth,” the institution commented on the urgent need for substantial affordable, quality housing in the country.
[Photo via Dat Vang Group]
