2025 OUTLOOK

The completion of the legal framework governing the real estate sector, marked by the introduction of three amended laws, has played a pivotal role in revitalizing  the market in 2024. A streamlined legal framework has facilitated businesses in resuming unfinished projects and launching new developments, creating a more favorable investment environment

Moving into 2025, we anticipate that the real estate market will continue to thrive, driven by supportive policies and sustained demand for home purchases, both for residential purposes and investment. Additionally, the market stands to benefit significantly from rapid infrastructure development. A series of key infrastructure projects are currently underway to enhance regional connectivity, including the Ho Chi Minh City Ring Road 3, Hanoi Ring Road 4, and the completion of metro lines. These projects will expand urban development spaces, improve accessibility to central areas, and provide strong growth momentum for suburban regions

Despite these positive factors, pricing barriers remain a challenge, as property values have been anchored at a high level, affecting actual market liquidity. As a result, we expect a moderate recovery in the short term, with clear differentiation among real estate enterprises based on their financial strength and project portfolios.

Regarding interest rates, we believe that there is little room for further reductions. However, the overall interest rate environment is expected to remain low throughout 2025, with only a slight potential increase. This will provide some support to the real estate sector, though high-end and large-value properties may still face affordability pressures.

2025 RE STOCK INVESTMENT OUTLOOK

We favor the following stocks: KDH (Target Price: 40,300, Upside: 20.8%) and NLG (Target Price: 42,600, Upside: 29.7%), as they align with the following key criteria:

(1)Having projects ready for launch in both the short and medium term, ensuring stable cash flow

(2)Executing a well-structured project pipeline, focusing on phased developments rather than excessive expansion, while ensuring legal and financial obligations are met before the implementation of the new land pricing framework

(3)Owning a large clean land bank located in prime locations and provinces with high economic growth pace, ensuring strong price appreciation potential and attracting genuine end-user demand for the projects

(4)Demonstrating strong project development capabilities, with short development and sales cycles, consistently building a solid market reputation over the years

Possessing strong financial resilience, enabling these businesses to effectively adapt to regulatory changes during the transition to the new legal framework

(ENG) GTJAS_Sector Report_Residential Real Estate Report_2025 Outlook_Mild recovery_26Feb2024