VietRees Newsletter 67 Week4 Month1 Year09

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Weekly Newsletter

Vietnam

Real Estate

A67

Week 4, January

The first weekly electronic newsletter issued to registered members, approximately 100,000 reads per month

joining to develop the newsletter VietRees, a member of

Free register for weekly newsletter: Please send your email to marketnews@VietRees.comSponsor and advestising: T: (84 8) 3948 5574 - E: properties@VietRees.com

Market situation (p.2)Real estate foreign investment (p.3)Vietnam in the world (p.3)Real estate agents (p.3)Websites of real estate companies in Vietnam (p.4)Real estate projects and prices (p.5)Real estate supply for customer groups (p.7)Real estate legislation (p.8)Construction material market last week (p.8)Stock market last week (p.8)

Research - Consulting (p.9)Market forecast, statistics expert opinions (p.10)

This weekly newsletter is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning or interested in Vietnam real estate market changes.Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsible for the occurring damage. Please visit thewebsite www.VietRees.com for further Vietnam Real Estate information. When individuals and organizations quote or publish the information from our newsletter, please cite the sourceVietRees.According to the statistics on registration for the newsletter, the subjects making reference to the newsletter includes real estate investors; companies or units of government performingmanagement tasks, business marketing, consulting, broking, assessment, real estate finance, construction, banking, architecture, interior decoration; domestic and foreign press agencies; andfull of professional investors or individuals who have demand for real estate throughout provinces and cities nationwide; typically Ho Chi Minh, Ha Noi, Da Nang, Can Tho, Hue, Nha Trang,BRVT, Binh Duong, Dong Nai, Ha Tay…We would like to say thanks to the sponsors and all of the readers. We expect to continue to receive your support as well as your comments to improve our newsletter.Readers can print or save this newsletter on your computers to review when needed or transfer it to others. However, think of environment when you want to print it out.

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Viet Nam Real Estate Newsletter A67 Page 2

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MARKET SITUATION

Real estate market in 2009: domesticenterprises be at an advantage

Tien Phong – 17 Jan, 2009 Although 2008 was considered to be an unsuccessful year for the Vietnamese real estate market,according to many opinions, the big projects would gradually fall into the foreign corporations’ hand.However, currently, the biggest difficulty that has made the real estate projects with the foreign-ownedinvestments delay or not properly follow the progress is that the capital disbursement will be hard due tothe global economic crisis. Therefore, this is considered to be a golden opportunity for the bigVietnamese enterprises to regain the advantage in 2009.In fact, among the 20 ‘Golden Projects’ in Ho Chi Minh city licensed in 2006, there have been only 2projects under construction & both of them belong to domestic investors. Many big projects in the heartof HCMC that are speeding up the progress also belong to Vietnamese enterprises and a series of other projects have also successfully raised the capital for the construction. In addition to some advantagessuch as: labor, materials, land price, etc, being at the low level, the housing demand for the small-sizehouses with suitable prices and the policy of kicking the demand for the cheap-price houses have alsobeen great opportunities for Vietnamese real estate enterprises. Because most of foreign enterpriseshave aimed at the market segment of high-grade apartments which is highly unable to find customers.According to some real estate experts, the purchasing and leasing demands for the high-gradeapartments have now been sluggish. The foreign-owned big projects will be hard to be converted or provide more products while the demand is still weak. Therefore, this is the chance for Vietnameseenterprises to be viable on their home market under the pressure of the foreign capital flows by someways such as investing, trading in the low-price projects that suit their low capital source and areencouraged by the State.

Foreigners buy houses in Vietnam:the door is open but many peoplestill waver

Nguoi Lao Dong – 17 Jan, 2009

After over two weekssince the resolution on the pilot program of allowing foreigners to buy and ownhouses in Vietnam that takes effect on 1stJanuary 2009, the HCM City real estate market has still seenno positive signal. The main reasons include the global economic crisis, the high apartment prices, beingafraid of the complex administrative procedures. As soon as the policy was still “on paper”, many realestate experts were rather optimistic, even some people were afraid that the above “open-door” policywill create a "storm" of purchasing houses in the big cities which would make high-grade apartmentscontinuously increase in price. However, many high-grade apartment projects offer much potential, thenumber of foreigners coming to inspect has increased in comparison with before, but there still are notransactions.Through the survey, most foreigners really have demands for buying houses in Vietnam. However, thetypes of houses that they like often should meet particular requirements such as: able to be used asoffices and accommodations, convenient for transportation, etc. With these factors, some apartmentprojects often do not meet the requirements in comparison with the types of townhouses and theapartment prices have still been quite high.Many experts have also shown that due to the global economic recession in general and the gloomysituation of the domestic real estate market in particular, the number of foreigners that have bravelypoured money into the real estate industry at this time has still been limited. A strong possibility is thatthe foreigners have still pondered about the market situation & have not hurriedly made their decisions.

Seek goods for real estate transactioncenters

Tuoi Tre – 21 Jan, 2009

Although the real estate market has not been warm yet, the stories about the transaction centers aregetting hotter each day. A series of real estate businesses in the entire country are urgently setting upthe transaction centers in accordance with the Real Estate Business Law and making every effort tomarket and seek goods for the future.The transaction centers not only include products of their own or the high-grade projects but also aim atthe market of single houses such as land, houses in the old urban areas, with valid documents andprestigious investors. In addition, many transaction centers in some large cities in the whole country alsocooperate to create the connection in terms of information of the domestic projects with the customersas well as the diversification of products.According to many real estate experts, the market still lacks products although many real estate projectshave been started in the last weeks of 2008, (but they will only offer their products from 2010 -2011onwards). The real estate transaction centers opened in the past have just made the beginning, butunfortunately the real estate market has come to a standstill which leads to the shortage of goods andabsence of customers. Meanwhile, the connection for adding products for the centers has still not beeneffective. The real estate experts suggest that it is time to consider opening transaction centers and thecurrent centers also should upgrade themselves to meet the standards, otherwise the market willeliminate the centers that have little goods, few customers and operate ineffectively.

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Viet Nam Real Estate Newsletter A67 Page 3

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REAL ESTATE FOREIGN INVETSMENT

Holiday Villas hired to manageTuan Chau tourism site

VietRees – 19 Jan, 2009On the morning 17th January, Au Lac Co., Quang Ninh (Tuan Chau Group) signed a contract withHoliday Villas Group (Malaysia) on managing the international tourism and amusement park Tuan Chau,Ha Long city, Quang Ninh province.Besides the purpose of transferring the technology of hotel management with the internationalstandards, Tuan Chau Group hopes that this is an opportunity to bring the tourists of Holiday Villasglobal system to Vietnam.

List of the localities attractingmost FDI in 2008

Source:

General Statistics OfficeNinh Thuan has continued to be the leadinglocality in attracting FDI in the list although it hashad only 2 invested projects. However, Ho ChiMinh city is the place attracting the highestnumber of projects with 418 projects.Department of Foreign Investment(under the Ministry of Planning andInvestment) has shown that the totalforeign investment in the real estatefield across the country in 2008 is23.6 billion USD (accounting for 36.8% of the total FDI).The top target in 2009 is to ensurethat FDI released will be equal to2008 or below 2 billion USD.

VIETNAM IN THE WORLD

Vietnam is one of the countriesseeing the positive signs

Sai Gon Giai Phong – Jan, 2009Grant Thornton International Corporation has announced the global ranking board in terms of theprospects for the economic development and clearly indicated the reduction in the positive signals in theprivate enterprises through the observations of over 7,000 enterprises at 36 countries. Grant Thorntonhas come to the conclusion that the decreasing demand is the biggest threat to the private companies.According to Grant Thornton, while the big economies such as the United States, Japan, and theEuropean Union have fallen into the economic crises, Vietnam has still maintained the strong growthrate in 2008. The main reason for the decline is the impact of the inflation and the global financial crisis.This has made the positive signal of the enterprises drop from 87% (in 2008) to 32% in 2009. With thisresult, Vietnam has ranked 7th in terms of optimism level in 2009.The private companies have been more advantageous in the time of the economic recession becausethe management board of the companies can make the decisions quickly due to the simple system andflexible policies. Therefore, these companies will operate more effectively than the organizations with thebureaucratic management style.

REAL ESTATE AGENTS

Real estate business corporationsto be born

TheSaiGonTimes – 19 Jan, 2009Ministry of Construction is building the project of establishing the two economic groups, includingVietnam Cement Corporation and Phuong Nam Real Estate Investment – Construction –Business. ThePrime Minister has approved this project at the beginning of the first quarter 2009.Ministry of Construction is accelerating the rate of the progress of equalizingand arranging itscorporations to jointhe groups, receiving the local businesses participating in the groups. Meanwhile, theMinistry also prepares the conditions and legal formalities to increase the charter capital of thecorporations chosen as the cores for the groups.

BCCI invests in constructing manybig apartment blocks

VietRees – 21 Jan, 2009Binh Chanh Joint Stock Investment Construction (BCCI) has shown that it will build some big projects inBinh Tan District, Ho Chi Minh City in 2009.The first project is An Lac building area in An Lac A ward with the total area of 7,990 m2. The 18-storeybuilding that includes 300 apartments with the total investment expected to be nearly 594 billion will bestarted in early 2009. Moreover, BCCI is also conducting setting up the document on basicdesigns andplans to start another apartment project, which is BCCI apartment block on a site of 4,000 m2 at An Lacward in early 2009.In addition, the company has completed the preparation stage for the investment and will implement theapartment project Tan Tao 1 in Tan Tao A ward with the expected total capital of over 574 billion thisyear.

Nguyen Do paid 10% of contributedcapital to customers

Nguoi Lao Dong – 21 Jan, 2009

On the morning of 21st January, 2009 Nguyen Do has paid 10% of the contributed capital to over 40customers contributing their capital to The Adonis 1 project in Go Vap District, Ho Chi Minh City.The company also intends to pay 10% of the contributed capital to the customers who bought theapartments of The Adonis 2 project (Dist.8, HCMC) on 22nd January 2009.

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