The 2008 financial crisis had an affect on foreign investment in Vietnam and foreign expatriates living in Vietnam.
The luxury property sector in Vietnam is being fueled by wealthy local Vietnamese property investors, filling the gap left by the foreigners leaving the Vietnam property market.
Last year we saw Vietnamese locals purchase luxury properties in the Hyatt Regency Residence and in a number of other luxury developments, all of those property transactions valued at over $180,000 and reaching $1.7 million for a luxury Villa.
The number of transactions and property purchases by local Vietnamese has come as quite a surprise considering that the average salary is $1,100 USD. Vietnamese are know to horde wealth in alternative investments such as vehicles, securities and pure gold.
Similarly to the situation in China, the gap between the wealthy and the poor is widening with many Vietnamese living in poverty whilst the wealthy gain more wealth though industries such as banking, manufacturing and tourism.
Previously property developers have been reliant on real estate purchases by foreigners, this reliance weakening is a good sign for the local economy and property sector.
Again very similarly to the property market in China the Vietnamese property sector has become overvalued as both local and foreign speculators drove markets out of reach for middle class.
In most places the across Asia and developing countries the decrease in foreign investment has been a depressing experience for the markets especially the luxury property sectors.
The increase in local demand in both the Vietnamese and other Asian local sectors will hopefully prevent the markets from being sufficiently corrected.