But why would houses appreciate if lots of them stay empty?
They aren't buying these for the rental income. They are buying it because they hope the next person is going to want to pay even more for it.
The pattern is that an investor (Chinese) starts a project, gets a bunch of people to buy into it, a shell of a building is created and then all the work stops and is left for dead. Usually stops because someone in the chain of command didn't get enough coffee money.
Nha Trang and Da Nang are popular beach areas and rife with these sorts of things, but you also see it all up and down the coast as well as in the big cities.
Da Lat has been completely ruined over the last few years. People post before/after pictures and whole valleys that were filled with trees or farmland are now replaced with houses. It is a short enough drive from Saigon that it makes for a great weekend escape. Except there is really only one mountain road into the place...
There is no equity market (that you can trust), bonds pay nothing so property is what you invest in (or you just sit on cash that is rapidly losing value during to inflation). Ownership is recognized even by corrupt bureaucrats and courts. Ownership papers are next to sacred documents. And no property tax so zero holding costs. The perfect investment.
No legally defined ownership? No problem! The developer is working on it. They just need $30,000 USD down to secure a plot. Ownership papers will follow.
So you pile your savings into real estate. You dump every single dollar you have into speculative real estate developments.. A single family home 10 km from a major city costs more than it does in California (~$1.5M USD) and local median wages are 1/10th that of the US. You can visit developments that are nothing more than 100 homes that are concrete shells with rusting window frames. Maybe 1% occupied.
But don’t get me wrong, some developments fill up super quick. But some just die.
Want to rent a place? Fuck you. Owners aren’t banking on rent, so pay them $3k per month. It’s all about appreciation. They would be happy to leave it empty. Less hassle that way.
Seems like a recipe for a major housing crash.