Southwest Vietnam: An Overlooked Real Estate Gem?

While the U.S. real estate market often dominates headlines,savvy investors are increasingly looking abroad for opportunities. One region gaining traction is Southwest Vietnam, particularly provinces like Can Tho, Long An, and Hau Giang. This area, often overshadowed by the bustling metropolises of Ho Chi Minh City and Hanoi, presents a unique blend of potential and affordability.

The Southwest region is poised to become a sought-after destination for both housing demand and investment capital, drawing attention from larger urban centers like Ho Chi Minh City and Binh Duong. This shift suggests a growing recognition of the region’s untapped potential and its attractiveness as an investment hub.

Southwest Vietnam will be the “destination” of the demand for housing and of the investment cash flow that moves from big cities like Ho Chi Minh and Binh Duong.

But why Southwest Vietnam? What makes this region a potential hotbed for real estate investment? Let’s delve into the factors at play.

A “Gentle” Market with Upside

According to industry experts, Southwest Vietnam’s real estate market is considered “gentle” compared to other, more volatile markets across Vietnam. This “gentleness” translates to a market that hasn’t experienced speculative bubbles and still possesses meaningful room for growth.

Consider this: unlike the rapid appreciation seen in some U.S. markets (think the pre-2008 housing boom or the recent pandemic-fueled surge), Southwest Vietnam’s growth has been more measured. This stability can be appealing to investors seeking long-term, sustainable returns.

…this is a relatively “gentle” market compared to other markets across the country. The nature of the market is “new,” it has not experienced any “fever” and still has a lot of room for growth.

Data from 2024 indicates a total of 74 housing projects offered for sale in the Southwest region, comprising both new and ongoing ventures. The total number of successful transactions amounted to 2,775 units/plots, marking a substantial increase of 70% compared to the previous year.

This increase in transactions, coupled with relatively stable prices, suggests a healthy demand and a market that is gradually maturing. However, potential investors should be aware that the supply side faces challenges. Many investors lacked confidence or the financial capability to launch their products, primarily drawing supply from unsold stocks and apartment projects in Can Tho and Long An.

Affordable Options and Emerging Luxury

One of the key draws of Southwest Vietnam is its affordability. While prices are on the rise, they remain competitive compared to major urban centers in Vietnam and, certainly, to many markets in the United States.

Apartments dominate the supply, followed by villas/townhouses, townhouses, and land plots. Prices have generally remained stable, with slight increases of 5-10%. Primary sales prices for commercial apartment projects in Can Tho average around 47 million VND per square meter (approximately $1,850 USD), while in Long An, they are lower, averaging below 30 million VND per square meter (approximately $1,180 USD). Secondary sales prices have shown minimal fluctuation.

The market is also seeing early signs of a shift towards higher-end developments. While affordable housing has been the focus, ther’s growing interest in sustainable, technology-integrated projects, mirroring trends seen in the U.S.market.

Can Tho, Long An, and Beyond

Within southwest Vietnam, several key areas are attracting attention:

• Can Tho: As a central city, can Tho is experiencing accelerated development. The market is becoming increasingly appealing to customers and investors. Apartment projects in Can Tho are being offered at a primary sale price of approximately 47 million VND/m2.
• Long An: Long An also has a significant number of apartment projects in the region. The sale price of apartments here is less than 30 million VND/m2.
• Hau Giang and An Giang: These provinces are attracting investment in land and homes, particularly near highways and industrial park projects.

In Can Tho, residential areas like NAM Long 2 (Hung Thanh neighborhood, Cai Rang district) are seeing strong sales, with land prices around 35 million VND/m2. Projects in this area are experiencing high transaction rates since their launch in November 2024.

This regional focus mirrors the dynamics seen in the U.S., where specific cities and regions often outperform national averages due to local economic factors and infrastructure investments.

Infrastructure Investments Spur Growth

Just as infrastructure projects drive real estate value in the U.S. (think of the impact of new transit lines on property values), Southwest Vietnam is benefiting from significant investments in transportation infrastructure.

Key projects include:

• The Can tho – Ca Mau Expressway
• the Chau Doc – Can Tho – Soc Trang Expressway
• The Rach mieu 2 Bridge

These projects are improving connectivity within the region and to other parts of Vietnam, making Southwest Vietnam more attractive to businesses and residents alike.

Particularly in the southwest region, the infrastructure is receiving investment attention, many key transport infrastructure projects are being implemented…which helps connect the region conveniently,thus increasing the value of the value of real estate In the region.

Strengthening the Foundation

A stable legal habitat is crucial for any real estate market to thrive. In Vietnam, revisions to key laws are aimed at creating a more clear and predictable market.

Revised laws, including the Housing Law, the real Estate Business Law, and the Revised Land Law, are designed to eliminate bottlenecks, promote clarity, and build investor confidence. these legal reforms are akin to the efforts in the U.S. to streamline zoning regulations and protect property rights.

In particular, the legal corridor has been completed, crucial laws such as the Housing Law, the Real Estate Business Law and the Revised Land Law have officially entered into force on August 1, 2024, helping the market to have a solid institutional base, helping to eliminate bottlenecks, contributing to more transparent and stable operations and creating confidence for investors.

A Growing Economy Fuels Demand

Vietnam’s strong economic growth is a significant driver of real estate demand. With a GDP growth of 7.09% in 2024 and a target of 8% in 2025,the country is experiencing rising incomes and increased housing demand.

This economic expansion has several positive effects on the real estate sector:

• Increased income leading to greater housing demand
• Stimulation of capital flow into real estate
• Positive impact on credit policy and interest rates
• Increased market confidence

A GDP per capita of over $5,000 USD signals a growing middle class with greater purchasing power, further fueling demand for housing.

At the same time,the economy recovers strongly: Vietnam’s GDP in 2024 increased 7.09%, continuing with the objective of 8% GDP growth in 2025, with a GDP per capita of more than 5,000 USD. This growth brings many benefits to the real estate sector: increased income, greater house demand; stimulate capital flow to the real estate sector; positive impact on credit policy and interest rates; market confidence.

Weighing the Risks and Rewards

Investing in any emerging market comes with risks. Potential investors in Southwest Vietnam should consider:

• Currency risk: Fluctuations in the Vietnamese dong (VND) against the U.S. dollar can impact returns.
• Regulatory risk: While reforms are underway, navigating the legal and regulatory landscape can be challenging.
• Market volatility: While the market is “gentle,” it’s still subject to economic cycles and unforeseen events.

However, the potential rewards can be significant. The combination of affordability, infrastructure investments, and strong economic growth makes Southwest Vietnam an intriguing option for investors seeking diversification and long-term growth.

Expert Outlook

Mr. Chau Thanh binh, Head of the Legal Department and Member of the Association’s Expert Council of Real estate in Can Tho, offers a valuable perspective on the market’s current state. He believes that past real estate prices were inflated, creating an imaginary value. However,according to Mr. Binh, current real estate prices reflect their true value, without artificial inflation from excessive speculation.

…previously the prices of the houses and the land were “inflated” to a level too high,which is actually an imaginary price.However, currently real estate is at its highest real value, there is no high price situation due to multiple investments. Currently, investors who have bought many goods will find ways to sell some to reduce financial load, so the sale price is at a reasonable level. therefore, this is the best time to invest in real estate. From the perspective of housing buyers, this is also the most appropriate time to build a place to live.

Bright Prospects Ahead

the outlook for Southwest Vietnam’s real estate market appears positive. With continued economic growth, infrastructure development, and legal reforms, the region is well-positioned for sustainable growth.

While challenges remain, the potential rewards make Southwest Vietnam a region worth watching for investors seeking opportunities beyond the U.S. market. Just as investors look to emerging markets in the U.S. Sun Belt, Southwest Vietnam offers a compelling case for international diversification.