7-8-2023 (HANOI) The Vietnamese condotel market continues to grapple with a prolonged slump, facing the challenge of excess inventory, and industry experts suggest that recovery might not be on the horizon until at least 2025, according to a report by local newspaper Vietnam News.
As of June, the unsold units in inventory have surged to a staggering 42,300, a number that far surpasses the combined inventory of beach shophouses and resort villas, based on a report from the DKRA Group, a prominent real estate consulting firm.
The current year has seen a sluggish pace of sales for existing condotels, a trend attributed to a combination of factors including the ongoing pandemic’s impact and the broader economic recession. Trang Bui, CEO of Cushman & Wakefield Vietnam, highlighted these challenges.
Vo Hong Thang, who serves as the Director of the Consulting & Project Development Division at DKRA Group, emphasized that the rapid expansion of the condotel segment in recent years has contributed to a significant oversupply issue. He further explained that the lack of well-defined regulations and standards for condotels, coupled with the failure of developers to fulfill profit commitments, has eroded investor confidence.
The Vietnam National Real Estate Association disclosed that the country currently has approximately 240 tourism property projects, encompassing around 114,000 condotels valued at an estimated 297 trillion Vietnamese dong (equivalent to about 12.5 billion U.S. dollars).
These condotel projects are primarily concentrated in regions with robust tourism markets, including major cities such as Ho Chi Minh City and Hanoi, along with Da Nang, and provinces like Binh Dinh, Khanh Hoa, and Binh Thuan.
