Ho Chi Minh City’s announcement of 17 projects eligible for foreign buyers last month, together with the new provisions in the Housing Law, has provided an initial boost.

The list includes several large-scale and prime-location developments such as City Garden, Dragon Village, and Gamuda Land’s Tan Thang sports and residential complex in Celadon City.

The municipal People’s Committee has assigned specific tasks to relevant departments to ensure the opening is tightly managed, balancing economic growth objectives with national defence and security.

The local Department of Construction is tasked with public disclosure, inspection, and compliance oversight, while the Department of Finance, the municipal police, and the city’s Military Command are to review and advise on security and defence factors in planning and project implementation.

The upgraded Housing Law, effective from this year, inherits and clarifies provisions on foreign homeownership. The law stipulates that foreigners may only purchase housing (apartments or detached houses) within commercial housing projects, except in areas critical for national security and defence.

Ownership quotas are clearly defined, at no more than 30 per cent of apartments in a condominium building, or no more than 250 detached houses in an area equivalent to one ward. Foreign individuals are granted ownership for 50 years, with possible extensions.

According to Alex Crane, managing director of Knight Frank Vietnam, the country is no longer just a low-cost alternative, but a strategic, long-term play.

“The government’s reform agenda, especially on developing the private economy, is creating momentum by reducing red tape, supporting smaller businesses, and incentivising innovation and technology. Despite global headwinds, the fundamentals here remain incredibly strong,” Crane told VIR.

Knight Frank’s figures show that since 2015, more than 12,000 foreign buyers have purchased apartments in Vietnam, with the majority concentrated in Ho Chi Minh City and Hanoi.

South Korean buyers have taken the lead, accounting for around 40 per cent of total transactions, followed by Hong Kong (30 per cent), China (15 per cent), Singapore (10 per cent), and Taiwan (5 per cent).

“This rising demand highlights Vietnam’s growing appeal as a competitive destination for global property investment,” Crane said. “These buyers, attracted by promising rental yields and capital gains, have access to a wide range of options from local to international apartment developers. In contrast, transactions involving villas, townhouses, and shophouses remain limited, due to unclear legal frameworks and the high capital requirements.”

Other experts, however, stress that more steps are needed to turn potential into reality and compete regionally. This is seen as the key to unlocking billions of US dollars in overseas remittances and foreign investment into the real estate sector.

Doan Van Binh, chairman of CEO Group, acknowledged the positive steps but pointed out a fundamental inconsistency compared to regional peers.

“Homes must be tied to land. The Housing Law allows foreign homeownership, but the Land Law still prohibits foreigners from holding land use rights, which is a barrier. Countries like Malaysia, Thailand, and Singapore have far more attractive and liberal policies, enabling them to fully leverage external resources for development,” Binh explained.

While legal reforms are advancing, some argue that more disruptive thinking and actions are needed to transform potential into genuine capital inflows.

Nguyen Quoc Bao, chairman of the Ho Chi Minh City Real Estate Club, emphasised the “golden capital” from overseas Vietnamese.

“We have nearly 10 million overseas Vietnamese, many with strong financial capacity. If policies are good enough to convince them to return, live, and invest, not only will the real estate market benefit, but the whole economy will get a significant boost from both capital and talent,” Bao said.