Recently, apartments committed to profit is tending to return to the real estate market. If this type of apartment was popular before in the resort real estate segment with condotel apartments and coastal villas, this type of apartment is now developing strongly in many markets, especially those with industrial potential.
As observed in the market, many real estate projects in major industrial capitals are now stepping up their profit commitments. In Bac Giang, Apec Aqua Park Bac Giang project is being committed by the Apec Group of 10 - 12%/year for customers in 5 - 10 years. It is known that this project is operated by Swiss Spirit Hospitality (Switzerland) in the top of the famous hotel groups in the world.
According to information from the investor, the reason why this Group dared to pledge profits to customers because the project was built in Bac Giang, where the growth rate of industry and economy is outstanding. "Bac Giang has gradually become one of the major industrial capitals of the North, attracting hundreds of thousands of foreign experts and senior laborers to live and work. This is a potential market for developing luxury apartments for rent, a prominent advantage for investment in serviced apartments", said Apec Group representative.
Apec Aqua Park is not the first apartment project of Apec Group to apply this policy. In Bac Ninh, the Royal Park Bac Ninh project of the investor Apec is also committing profits of 12%/year. In addition, many resort real estate projects of Apec Group in Mui Ne, Hue, Ninh Thuan, Bac Ninh, Lang Son... are also being applied by this investor to commit a 12% profit policy in 5-10 year.
Committed flats are always highly profitable with many risks.
In Hanoi, the Hanoi Golden Lake apartment of Hoa Binh is also being applied by the investor with a 10% profit commitment policy. In Ho Chi Minh City, many apartments in District 1 are expensive but have the potential to lease and are also sold by the investor with a commitment of profit.
In the resort real estate market, after a slowdown at the end of the year, 2018 entering 2019 a series of real estate projects were also committed to profit by investors such as Ohara Lake View Resort Project in Luong Son, Hoa Binh The investor commits 12% profit per year for 15 years. Similarly, the Kai Resort Project in Ky Son, Hoa Binh (the selling price of VND 2.6 billion per lot of villas) was also committed to 12.5% profit per year for 10-15 years and also pay the rent in advance. 4 years and deducted directly from the selling price. SunBay Park Hotel & Resort Phan Rang in Ninh Thuan is also committed by the investor to earn a lifetime profit of 12%/year, Condotel Sapphire Ha Long is also applying a 10% profit commitment policy within 5 year...
According to experts, the apartment is committed to attracting investors, especially when the commitment is up to 10-12%/year for about 5 - 10 years. Committed flats are especially suitable for investors who do not have much experience in operating management. Accordingly, investors will receive a fixed profit of about 10 - 12%/year during the commitment period, without the effort or expense to operate the apartment for rent. Along with that, real estate products will increase in price over time, bringing opportunities to transfer profits for investors.
However, high profits always come with many risks. Apartments committed to profit also owns certain risks that make many investors wonder. The first is the risk from the investor. Some developers are willing to commit to high profits, but do not guarantee that when the product goes into operation. Even many projects are not built on schedule, investors do not have money to pay annual profits to customers. This means that customers will not receive any further information after the money down.
The second is the risk from the operator. Some projects are managed and operated by an incompetent unit, resulting in the expected growth rate, investors are unable to maintain the committed profit paid to customers. The third is the risk from product quality. Risks occur when finished construction products are not adequate utilities, services and quality assurance as committed by the investor.
Therefore, according to experts, when investing in this segment, customers must pay special attention to the potential for renting apartments in that area. In particular, it is necessary to evaluate the project operating unit after it is completed. And yet, need to assess the financial potential of the investor.
According to Nam Anh