Vietnam is the second most popular destination among South Koreans for overseas property investment with $56.1 million USD invested in 2018, according to Bank of Korea data. The U.S. was the number one location, with $255.2 million USD in property investments last year.
Vietnam relaxed its foreign ownership laws in 2015 and since that time Vietnamese condominiums, priced in the $270,000 USD (300 million KRW) range have been popular with South Korean citizens. Vietnam, Malaysia and other Southeast Asian countries are popular due to strong return possibilities.
Park Sang-wook at Woori Bank in Ho Chi Minh City said, “As the Vietnamese economy grows at breakneck speed, home prices are expected to soar, and many people are purchasing several apartments there, expecting profits 10 years from now.”
South Korean realtors and investment advisors advise their South Korean clients that overseas investments carry potential risks, primarily from insufficient and wrong information, available at a distance. They advise that it is crucial to find a trustworthy agent and check tax details and exchange rate trends. Said one realtor, “Korean investors are interested in condos in Vietnam, but a lot of them are being built, and this raises the chance of oversupply and falling prices.”
Other Asian countries have also been attractive locations for investment. Japan received $15.8 million USD in investment funds and Thailand also received $15.5 million in investment funds. In Japan, which will host the 2020 Summer Olympics, real estate prices are rising, while Prime Minister Shinzo Abe’s economic policies have resulted in ultra-low interest rates, prompting many investors to turn to real estate.
Overall, South Koreans invested $445.1 million USD in overseas properties in 2018, an increase of 47% above 2017 and an increase of 380% from five years earlier. As well as personal real estate investment, South Korea has been the largest investor in Vietnam with total investment capital of $55.8 billion USD.