Residential property sector report: Tailwinds expected from legal reforms
Posted: Jul 15, 2025
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We believe that improvements in the legal framework, combined with gradually recovering funding channels, will positively impact real estate developers over the medium to long term. Developers with land banks in the highlighted beneficiary areas are expected to: (1) achieve stronger absorption rates at ongoing and upcoming projects, and (2) benefit from better pricing as regional infrastructure and economic conditions improve.
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Several real estate stocks have already shown positive price movements compared to early 2025 and relative to the VN-Index, partially reflecting the favorable developments mentioned above. However, we believe further upside remains thanks to improving sales momentum, resolved legal obstacles at certain projects and accelerating project execution. We believe that current valuations have yet to fully reflect this growth potential.
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We prioritize stock selection based on the following criteria: (1) Projects likely to benefit from legal reforms, either through accelerated execution or improved pricing; (2) Strong growth prospects in 2025-2026 supported by a solid project handover pipeline; (3) Attractive upside potential relative to target prices. Accordingly, we recommend NLG and KDH for our investment strategy in 2H25.
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