Realty, banking stocks surge on new monetary policy

Real estate and banking shares have become the hottest stocks on the Vietnamese stock market after the State Bank of Vietnam signaled a loosening of monetary policiesto boost lending to realty developers and homebuyers.

By the close of the Thursday session, the benchmark VN-Index of the Ho Chi Minh Stock Exchange (HoSE) rose 6.52 points (1.42 percent) to 465.26 points.

The total trading volume rose sharply to 106 million units, with a total transaction value of over VND1.76 trillion.

The VN30 index shot up with an increase of 9.65 points (1.83 percent) to 537.28 points.

The total trading volume and value reached 35.1 million units and VND811 billion, respectively.

On the Hanoi Stock Exchange (HNX), the benchmark HNX-Index rose 1.03 points to 78.54 points. Liquidity in this market increased sharply from the previous session.

Total trading volume and the value of the market rose 121.7 million shares and VND1.185 trillion, respectively.

Most real estate stocks in the VN30 group continued to hit the ceiling prices, including shares subject to delisting warnings due to heavy losses like QCG of Quoc Cuong Gia Lai. The share hit the ceiling at VND12,300 per share with no remaining surplus stock.

According to HoSE, QCG shares today are placed under warnings due to negative post-tax profits of VND39.83 billion in 2011.

Other realty stocks, including DIG, ITA, KDH and SJS, peaked at their ceiling prices for another session with respective price increase of VND900, VND400, VND1,000, and VND1,700 per share.

In the morning session, most stocks rose strongly. In particular a strong cash flow, excited by the latest decision from the State Bank of Vietnam, was channeled into real estate stocks.

Most real estate stocks are heading up seamlessly from the morning session to their highest price, including DIG (4.6 percent), HDC (5.0 percent), ITA (4.3 percent), LCG (4.4 percent), NTL (4 percent), SJS (4.8 percent), and TDH (4.9 percent).

In addition, bank stocks also rose more sharply than the average rate of the market. Cash flow is returning a strong market.

According to technical analysis, both the VN-Index and HNX-Index are making breakout points and are ready to rise.

Taking a Bath in Vietnam Real Estate

Ho Chi Minh City got a 68-story skyscraper, Vietnam’s tallest, when the downtown Bitexco Financial Tower was inaugurated in 2010. The building, boasting a helipad at the 50th floor, can be seen from almost every part of the city.

It hasn’t been a celebration for the owner, however. Nearly 18 months later half of the building’s office space is still empty and none of the six retail podiums is open. Annualized interest rates reached as high as 23% late last year, and there are plenty of rumors that the owner is trying to sell the building to pay off construction loans. But the company dismisses them. “Bitexco Financial Tower is our pride; we are not selling it,” says Vu Quang Hoi, chairman of Bitexco, a private Vietnamese company that’s invested in more than a dozen other real estate projects, plus infrastructure, energy and mining. “This is a difficult time for businesses, but it is precisely why we need to continue to invest more.”

Vietnam mulls ban on unfinished home sales

An incomplete mansion in Hanoi
The Ministry of Construction has proposed a new rule that bans project developers to sell land and half-built houses to customers.
Residential property developers must finish construction before being allowed to sell their projects, the rule said.

In its latest report on the real estate market, the ministry found that many people cannot afford a house while some others have been leaving their houses unfinished and unoccupied for a long time, which it said is a waste of land resources.

An inspection of 18 residential projects in Hanoi found that only 80 percent of townhouses and 50 percent of villas were put into use, according to the report.

The Ministry of Construction said it is necessary to control bank loans to real estate projects, especially in the high-end market segment. Uncontrolled credit to luxury housing and resort projects can cause the market to collapse, the ministry warned.

UAE investments in Vietnam have reached $3 billion

The UAE spent $130 million in direct investments in Vietnam, while additional indirect investments such as joint ventures and securities brought the total figure to $3 billion, said Vo Hong Phuc, Vietnamese Minister of Planning and Investments after signing a Memorandum of Understanding with Emirates Gate Investment yesterday. "The aim is to facilitate UAE entrepreneurs to invest in Vietnam," he said, adding that a host of UAE firms are already investing in Vietnam and more continue to show interest.
"Investment from the UAE to Vietnam is modest but I see potential for the future," he told reporters after the event. Key investment sectors include manufacturing, energy and infrastructure, he added.

Vietnam office rents among the highest in the world

HO CHI MINH CITY: The office rent rates in Vietnam’s biggest cities such as Ho Chi Minh City and Hanoi are among the highest in over 100 markets worldwide, according to an annual report released by British real estate services firm Knight Frank last week.
Ho Chi Minh City is the 19th and Hanoi (21st) most expensive markets with prime rents at US$38 and US$36.5 per square metre per month respectively, the report said.
The rates are more expensive than established markets like Manhattan (New York), Frankfurt (Germany ), Shanghai (China ), Brussels (Belgium ) and Rome( Italy), according to the Vietnam news agency.
However, the availability has increased in Vietnam, with both the cities seeing large amounts of new Grade A office supply during 2010.
This has caused vacancy rates to rise and put pressure on Grade A rents.
Meanwhile, demand remains strong in the Grade B and C office sectors, according to the report.
Elsewhere, the rental growth has been led by the world’s major financial centres, with office rents rising in cities such as London, New York, Hong Kong and Singapore, said the report.