Appearing 100 years ago in the US, luxury real estate is spreading in emerging countries in terms of market size by country, with Thailand in second and the United Arab Emirates in second. the third position…
Currently, in the world, there are nearly 100,000 apartments in the luxury real estate segment.
INCREASE 2.3 TIMES IN THE LAST 10 YEARS
Supply is forecast to nearly double by 2026, tied to an increase in the number of active brands, from 69 brands in 2011 to 133 brands in 2021, according to Savills.
Previously, the majority of luxury real estate projects were concentrated in North America, which is also the first place where these real estate products appeared.
Supply is growing strongly in the Asia Pacific and Middle East regions, driven by economic growth and property growth in each country over the past decade.
In terms of market size by country, the US is leading the world, followed by Thailand and the United Arab Emirates in third.
In terms of supply, North America ranked number one in the world market, accounting for 35% of total supply. The Asia Pacific region recorded a growth rate close to 26% and ranked second globally.
Branded real estate will continue to record growth on a global scale with new hotspots emerging in the near future, such as Costa Rica, Nigeria, Cayman Islands and Egypt expected to increase. double the current supply (with a low starting point).
Diversity of global supply will be more prominent with the participation of the Belgian, Serbian and Dominican markets this year.
The participation of emerging markets along with the growth momentum in major markets shows the potential of this type of real estate today. This is a solid basis for brands and investors to confidently enter new geographies.
Around the world, the urban luxury real estate market was developed nearly a century ago with the first project being The Sherry-Netherland in New York City, USA in 1920, notes CBRE.
After 100 years of development, if including the luxury real estate projects outside of urban areas in the resorts, the number is up to more than 500 projects. The luxury real estate market in urban areas accounts for about 62% of the total number of branded properties, the rest is 38% of the total number of projects coming from coastal resorts, mountains and suburbs.
VIETNAM: LATE VISION OF BRAND EFFECTS
In Southeast Asian countries (ASEAN), luxury urban real estate has been present in Singapore with the St. Regis Residences in 2006 and in Bangkok, Thailand is the St. Regis and Sukhothai Residences in 2007, according to CBRE research.
In Vietnam, by the end of 2021, the first two real estate projects will be received. One project is located in the center of Hanoi capital with the asking price from about 35,000 USD/m2, another project is located in the center of Ho Chi Minh City with the asking price from about 16,000 USD/m2.
It is expected that in 2022, the Vietnamese market will receive one more branded project in the central area.
Mr. Matthew Powell, Director of Savills Hanoi said that, despite not having a great influence, luxury real estate still has a positive impact on the market in bringing high-quality design standards and introducing new products. quintessence of the brand as well as quality management services.
Branded products will continue to be developed by investors in potential localities, such as: Da Nang, Ha Long (Quang Ninh), Phu Quoc (Kien Giang), Nha Trang (Khanh Hoa).
The question for the Vietnamese market is whether this super-luxury real estate model can meet the needs and capacity of the market.
According to Ms. Duong Thuy Dung, Senior Director of CBRE Vietnam, the emergence of luxury real estate in urban areas comes from the actual demand in the market combined with factors such as location, view, and product quality. products and management units will increase the value of luxury real estate products in urban areas.
Because, when handing over brand-name products, they will be managed by 5-star hotel management units, which are brands with a lot of experience in real estate management. This will always ensure that the value of the products is not lost but also increases over time.
In addition, according to a report by Wealth-X, the upper class population in Vietnam has increased by 13.9%/year in the period 2010-2019 and is forecasted to grow by 10%/year in the period 2018-2023.
The rapid growth of the rich group in Vietnam and the need to improve the quality of life will contribute to the activation of luxury products in the urban area.
Therefore, the rise of the upper class will positively support the demand for luxury real estate in Vietnam as the search for housing with absolute security, privacy, trendy lifestyle, community and class, high-class facilities and convenient traffic connections are increasing day by day.