Podcast: Good morning, Vietnam apartments

HCMC-apartments-e1711067979624.jpg

Projects in Saigon's Thu Duc City, February 2024. Photo by VnExpress/Quynh Tran

The Flat Chat Wrap comes to you from a whole other country – or at least half of it does – with Jimmy in Saigon trying to finish his fourth novel (writing, not reading).

While there he has discovered that there are very similar problems with overseas investors as we have here in Australia.

Continuing the travel theme, Jimmy and Sue discuss the proposed changes to Airbnb laws intended to correct the “light touch” legislation currently in place.

And we can’t mention travel without referring to Mild Rover which this week has pictures to back up Jimmy’s jaunt with Bafta-winning writer Kieran Prendiville, as well as a liverish look at the best and worst in-flight food services.

And finally there’s a touching story by Sue about how an artistic tribute to her late Mum became part of the healing process.

That’s all in this week’s Flat Chat Wrap.

TRANSCRIPT IN FULL

Jimmy   00:00

Hello from Vietnam!

Sue   00:01

Hi, Jimmy, how are you doing over there?

Jimmy   00:04

I’m good. I’m sitting in… I’m not sure if it is Airbnb; it would probably come up on Airbnb. I’d say this was pretty close to being an Airbnb hotel, or a short-term letting hotel.

Sue   00:19

So there’s no permanent residents there?

Jimmy   00:22

I don’t know. There seems to be an awful lot of tourists coming and going. The lobby is as busy as a hotel at certain times of day, like check-out times and check-in times, but it’s nice enough. It’s an interesting area. It’s not an area of Saigon that I’ve stayed in before; it’s much nearer what they call ‘the walking street,’ or ‘the backpacker street,’ as it used to be known. Its real out there. You know, you’re walking out of the apartment block and stepping over dogs and dancing around fruit trucks.

Sue   00:42

It sounds fun. I mean, you went there because you’re finishing off your novel, aren’t you? So you’re meant to be sitting by your computer all the time; is that happening?

Jimmy   01:07

Not all the time; I’m not sitting at the computer all the time, but I have been getting a fair bit of work done. I do have to go out to eat. There is so much to eat around here. Now that you’ve reminded me about what I really should be doing, I’d better get on with it. I’m Jimmy Thomson, I write the Flat Chat column for the Australian Financial Review.

Sue   01:57

And I’m Sue Williams  and I write about property for the Sydney Morning Herald, the Melbourne Age, the AFR and Domain. 

Jimmy   02:02

And this is the Flat Chat Wrap. It’s very funny to come to Vietnam and find stories that sound awfully familiar, about apartment block investors.

Sue   02:27

Yes, because I think Vietnam changed the policy, didn’t they? Because you used to only be able to buy property in Vietnam (like in many other places, like Bali), if you went into a partnership with a local person. I think they’ve changed that now, haven’t they? Now you can buy a property in Vietnam, I think, from about 2015. Foreigners can buy places, and I think a lot of Australians have.

Jimmy   02:51

I think the problem in the past was that the people were going into partnerships with Vietnamese people and getting into disputes with them and when they went to court, the courts were always finding in favour of the local people. That deterred a lot of people from investing. But now there are huge apartment blocks springing up, or have been springing up, around , certainly Saigon, Hanoi, and Danang. And this is where a lot of the investment money is going in. But it’s also apparently where a lot of these apartments are sitting empty, with the overseas investors just wanting them to accrue some capital gains.

Sue   03:29

Well, that’s not very good for city life, is it really? I mean, we’ve had similar problems in Sydney and Melbourne and to some extent in Perth, where people have bought apartments and just hadn’t lived there. We call them ‘ghost apartments,’ and it’s really hard for the other people living there, because suddenly, there’s not much community. I mean, we’ve actually lived nex door to an empty apartment in Sydney for 20 years and it’s kind of nice in some ways, because you don’t get any noise. On the other hand, it just seems an incredible waste. So I mean, somebody could be living there and it could be a doctor, or a nurse, or an aged care worker, or somebody like that; somebody really useful. And unfortunately, they’re having to live somewhere else, because they can’t afford to live in this empty apartment next door. It’s pretty hard for everyone I think, when people buy places and then just leave them empty.

Jimmy   04:27

And over in London, they’re talking about bringing in a tax on empty apartments and these are prestigious apartments, right in the centre of the city. But you know, the people who are buying them, money is no object to them; they just pay the tax. From our point of view, in Sydney, one of the problems is that the overseas investors put their money down, they buy the apartment, and then they just forget about it, and they don’t pay the levies, because they think they will pay the levies when the apartment is sold eventually. Which is terrible for everybody else, because you’re subsidising somebody, and okay, the money might well come back in when the apartment is sold, but that doesn’t help you in your-day-to-day.

Sue   05:15

Sure. I mean, that could be in 20 years and so all the people who are living there now are having to pay extra to maintain the building, because they’re not getting that money from that person’s strata levies.

Jimmy   05:27

And its hard to get people who live overseas to respond to legal action in your own country. It’s hard to get in touch with them in a lot of cases and threatening them with bankruptcy and things like that doesn’t really work.

Sue   05:45

And it’s interesting, because there’s lots of overseas capital around the market now. They keep saying that Australia is the number one destination for lots of overseas capital and often it’s residential property in Sydney, which is right at the top of the list. So lots of people from overseas are investing here and when they don’t particularly need the money, they are leaving apartments empty. So we kind of get a bit annoyed about that. But then it’s interesting to think about Australians buying property in Vietnam and leaving it empty as well. So you know, whatever one’s race, we’re all kind of as guilty as everyone else, really.

Jimmy   06:22

The big investors here in Vietnam are China-we forget that China’s just right across the border, the other side of Ha Long Bay-Singapore, and I think Korea, are the big investors here.

Sue   06:37

And also, there’s a lot of Russian money, isn’t there, particularly in Daman?

Jimmy   06:42

Yes, indeed.

Sue   06:43

When you were talking about London earlier, lots of that money is either from the Middle East or from Russia. Maybe less now, because it’s harder for them to invest overseas, but many of them invest in offshore trust funds, so its really hard to trace it. So you know, the money is still there.

Jimmy   07:02

And you know, the thing that the government’s will look at is, do we want to really restrict these investors coming into the country and bringing their money in, because it’s hard enough to get these apartments built by using local money to get the construction industry going, because ultimately what we need is more housing, and if a small percentage of that housing sits empty, that’s not good, but it’s better than those apartments never being built.

Sue   07:34

Absolutely. So maybe the government, both here and in Vietnam, could do something proactive and say to people who have apartments that are empty, we will pay you a small fee every month, to let your apartment to somebody for social or affordable housing. Because that would save the government money in building that social affordable housing, which is so badly needed, and at the same time, it would give a small income to people who have an apartment that’s empty. Could there be some kind of discussion between the two?

Jimmy   09:44

I dont know. I mean anecdotally, a lot of the overseas investors don’t want anybody to have ever set foot in their apartment. They sign the paper and don’t even go in there, until either they want to sell it, or they want to move. A lot of them buy apartments for their kids to stay in whilst they are at university. I mean, there’s a lot of settling down happening after COVID, but I think the pattern is starting to emerge again of a lot of young people from overseas looking for accomodation and having to take stuff that they really shouldn’t be living in, in a lot of cases. I’m looking out the window here… This apartment block; this Airbnb hotel, is 30 storeys high. I’m sure there’s a lot of longterm residents in here… Right across the alleyway, there’s another 30 storey building, that’s only half built. Looking at it, I would say it would be about six months, maybe to a year away from completion and then COVID hit and everything stopped. Even though Vietnam handled COVID better than most countries, a lot of the countries that didn’t handle COVID particularly well withdrew their overseas investments, because they were in trouble. It’s just sitting there; it’s kind of a monument to what happened in COVID and halfway into the city, there’s a huge, what was intended to be a luxury hotel and it’s just a concrete shell.

Sue   09:46

Hopefully, they are going to be picked up and finished off, all these buildings? It will just be your luck that while you’re staying in that apartment, the apartment building across the road will suddenly start work again, after being empty for four years. Then you will curse yourself for having said “what a shame these buildings haven’t been built.”

Jimmy   10:00

Well, it’s funny; just yesterday, I was woken to the sounds of clanking metal and looking down, in the area between where I’m staying and the half-finished building, there were a couple of guys moving construction stuff around. It looked to me as if they were either checking it, or counting it. So maybe they’re doing an audit, before they start work on the building. But according to the same newspaper, The Vietnam Express (that had the story about overseas investors), no new buildings; no new apartment buildings, were started in Saigon in the first two months of this year. So obviously, things have taken a while to get going again.  I complained about a barking dog the other day. There’s  a very strict no-pets rule in this building. But somebody somewhere in the 34 storeys-and probably 300 apartments-had decided to leave their dog on the balcony while they went out. And of course, anybody who understands dogs, knows all the dog is going to do is bark and bark and bark, until they’re allowed back in. I complained to the host of the place and about 20 minutes later, the barking stopped.

Sue   11:37

You didn’t hear a gunshot as well, did you?

Jimmy   11:39

I didn’t; I was listening for it.

Sue   11:43

It’s  funny with COVID… Last night, I went to the Film Critics Circle Awards of Australia… It’s kind of the annual Australian equivalent of the Golden Globes, but it is less glamorous. In fact, we had sandwiches to eat and it was at an RSL Club, so it wasn’t as fabulous as the one you see on TV. But you know, there was a great range of Australian films and it’s the first time they’ve been held since COVID. Everybody was talking about the problems of filmmaking during COVID and also, seeing films and reviewing films. But nobody would actually say the word “COVID.” It’s really interesting; it became the thing that could not be named. A lot of people doing that now, because it just brings back so many dark memories for a lot of people, so we’re kind of trying to wipe it. I think that’s quite a healthy trend.

Jimmy   11:48

A fabulous night out, I hear. I know that I’ve been told in my various writings, not to overstress COVID. It’s like everybody really does want to move on. I think we’re all kind of wondering, did we have to go through all those lockdowns and things? Its easier just to think about the future, rather than the past.

Sue   13:03

There are some unfortunate people who are still suffering.

Jimmy   13:11

When we come back, we’re going to talk about the new plans that the government might have, to put some restrictions on Airbnb’s and other short term holiday lets.

Sue   13:38

It seems that in Sydney, we’re finally getting a bit of movement on short term lets on Airbnb and Stayz and those kind of companies, because Airbnb and Stayz have accepted that guests should pay a levy to fund social and affordable housing in New South Wales, which is good, but they want the tax to also apply to all tourism accommodation, including hotels, which doesn’t seem fair at all. I mean, hotels pay a huge chunk of their income in tax, whereas Airbnb and Stayz and people renting out accommodation, haven’t paid an enormous amount for a while. They may go the way of Uber, which has had to pay a huge amount to taxi drivers in compensation. Maybe, there’s some court cases that hotels might take against them. But anyway, there’s all these short term rental accommodation places, because I think a lot of people now say that there is a quantifiable effect on housing supply and affordability in certain areas. You know, the kind of areas like Bondi Beach, that people want to rent apartments in on the short term, for a holiday, but it means that locals just can’t afford them anymore. So it sounds like we are going to get some movement.

Jimmy   14:56

It’s interesting, because I was reading The Sydney  Morning Herald story covering this and they quote Rose Jackson, the Housing Minister. She conceded that the legislation about short term holiday letting has been deliberately light touch. They didnt want to put in too many rules,  because they don’t want affect tourism. The Airbnb people are notorious; I think its one of the consequences of having an American company. They just come out with such bullshit all the time and its all false equivalencies. They refuse to recognise that apartmentsvespecially, going into short term rentals has any affect on availability, or indeed has any affect on the lifestyles on the people who live in the apartments permanently. This is the thing that really annoys me, especially the Victorian government and to a great extent, the New South Wales government.. They dont give a crap about people who live in apartments.

Sue   15:28

Out of sight, out of mind.

Jimmy   16:05

You’ve got the people in Customer Services (whatever it’s called these days), Fair Trading and all that. It’s their job to look after what’s happening in apartments and they do make efforts to make apartment living more attractive, because they have to; they need more people to live in apartments. And apart from them, you look at the tourism people, you look at the Attorney-General’s Office, you look at the the finance people… They don’t care; all they’re looking at is, if we deter tourists from coming into the state, then Victoria will get them, or Queensland will get them and that’s their prime concern. You would  think the major concern would be the people who actually live here, rather than the people who might come here from the UK and other countries.

Sue   16:52

There’s a lot of pussyfooting around really, isn’t there?

Jimmy   16:55

Yes, absolutely. It’s too confusing for them. You’re dealing with people who are not particularly bright (I’m talking about the politicians). You say to them “look, there’s this complicated thing here, where we’ve got people who want to live in apartments, and we want people to live in apartments, and people aren’t sure about apartments. And when we’re getting people used to the idea of living in apartments, along comes this thing, that means that the people next door can be having all-night parties every weekend and that’s putting people off,” and they go “can we just look at the bottom line? How much is this going to cost us?” That’s what they look at; that’s all they look at. They think people like us, who actually give a damn about apartment living, are a bit weird.

Sue   17:39

It’s kind of interesting, isn’t it… Maybe, people in houses tend to be better organised, because they have a lot of pressure groups. Something’s going to happen on their street, or there’s going to be a building built opposite them, or something like that. Maybe they’re just better at getting organised; getting together and making their voices heard. Whereas people in apartments, maybe we’re just all a little bit remote from the street and we’re a bit remote from our neighbours, even though we’re living cheek-by-jowl with them and we’re just a little bit more anonymous. I don’t know. Maybe that’s the nature of apartment living, that we don’t think so much about the world around us, because we’re just in our little bubble and we just love it.

Jimmy   17:39

I think there’s a big factor of people in apartments, that don’t want to attract any attention to any problems.

Sue   18:21

It’s the nature of people; they just want to concentrate on their lifestyle and their work, or their families, or their relationships. They don’t want to worry about home maintenance, like lawns and things, so they’re not as in touch with their physical surroundings, perhaps.

Jimmy   18:46

Also, I think there’s a sense with apartments; there has always been a thought that it’s a transient thing. It’s only now that people are moving into apartments and calling them their forever home… When we started living in apartments in Sydney, it was all about you would live in an apartment for seven years, and then either move up to a nicer apartment in a nicer area, or go and buy a house somewhere. And then because of that transience, people are not particularly interested in investing their time and energy in something that in their minds, could affect the value of the property. But I noticed that one of the suggestions that’s been highlighted from this recent discussion paper about Airbnb, is that they are going to limit the number of people who can stay in an apartment as a holiday let; just try and stop the party-house effect. And as somebody pointed out-I think it might have been the author of the paper-there’s no point in bringing in rules if they’re not enforceable. That is so true and because they are not prepared to crack down on people who break the rules, who do not follow the code of conduct and I doubt if there’s very many people running Airbnb’s at the moment who do follow the code of conduct strictly, they don’t do anything. There’s been no action taken against them in the two years since the the Airbnb list came in, the short term rental accommodation list and the Code of Conduct, there hasn’t been a single person taken to task over the way they run their building; not one.

Sue   20:15

Yes, sure thing. And it’s not that it hasn’t happened.

Jimmy   20:32

I mean, people are living next to party flats and it’s   driving them mad all the time. The light touch is the key phrase in all this for me. They are now recognising that they could have done a bit more. ‘They’ being of course, the Liberal government before this one, but the Labor government went along with it. There weren’t many objections when the the rules-such as they are- came in. When we come back, we’re going to look at Great Escape, our little holiday thing. Very appropriately, since we’re talking about Airbnb.

Sue   21:13

So what destination, or special offer are you talking about this week, for Great Escapes element?

Jimmy   21:18

What we’re finding is people are responding to the personal stories that we’re writing. I did one about our honeymoon disaster. That’s had a lot of readers and the other week I did a thing about decoding TripAdvisor and other review sites. So this week, I am doing an edited version of a story that appeared in the Sydney Morning Herald online here in Sydney and in The Age in print, about a trip I did with my writer friend, Kieran Prendiville, hiking through Northern Province.

Sue   21:19

Very nice. I remember you doing that; it sounded absolutely amazing.

Jimmy   21:25

It was really hard. It was very, very, very hard. But we were basically hiking from one gourmet boutique hotel, that overfed us to the next. It was just as well that we had been able to do the exercise in between, or we would have come home looking like balloons. I’m going to do a quick edit on that and that will be on Mild Rover. The full thing is on the Sydney Morning Herald online. The traveller section is behind the paywall. You can get a taste of it on on Mild Rover and if you’ve got a subscription to the Sydney Morning Herald, then you’ll be able to see the whole thing.

Sue   22:46

Or The Age.

Jimmy   22:46

But I’ve got a lot of pictures that I took, that did not appear in the Sydney Morning Herald, so you’ll certainly be able to look at those. Sue, you’ve got a bit of a tribute to your late Mum; what’s happening with that?

Sue   23:03

I wrote a story for the Herald, which is running tonight, I think. And it’s about how when my mum died, it was just awful, but there was an art gallery just near the hospital. I went in there one day and started talking to the guy who runs it and he’s an Aboriginal artist, and he has a lot of Aboriginal art there. He was really such a nice man and in the end, I decided to commission a piece of art to sort of mark my mum’s death abd he was amazing. He asked me all about my mum; he asked me what kind of music she liked. He asked me why was I in Lithgow and how I’d get there to see her and then he incorporated all that into the piece of art. He would text me pictures of him doing the art. I always travelled up to Lithgow by train and there were five stations in between, when I got the fast train. There were parts of the art that showed the different spots for the stations, and he showed me the picture. It was kind of moving to the sound of a train in the background; it was quite incredible. He was telling me that a lot of Aboriginal people believe that the spirit goes up and meets back with the ancestors and so people like my mum would be celebrating with the ancestors, and they would be welcoming her back and it just gave me an awful lot of solace, really. I ended up talking to some art therapists and they were saying art is a really fantastic way of dealing with grief. And that is something a lot of people kind of turn to, when they’re having a real problem. And so I decided a story about it, because I thought it was really interesting. So yes, that was that was my story.

Jimmy   24:53

And that’s going to be on the Sydney Morning Herald, by the time this is up on our website. Keep an eye out for that. All right. Well, it’s been a technically difficult podcast to pull together today. I hope it all sounds okay. I’ve got to give a shout out to one of our listeners, who pointed out there was a couple of flaws in the last one, due to bad editing. She said “have you got a new editor? They’re not very good.” And I said “it’s not a new editor; it’s the same old me and I just made a mistake.”

Sue   25:34

I would have been tempted to have said “yes, we’ve got a new editor. I will fire them immediately.”

Jimmy   25:39

Like you said about me once. When somebody complained about a problem they were having, because you had asked me to do something. And you said “oh, yes, he’s been a problem. We got rid of him.” Terrible, person you are!

Sue   25:57

Sorry!

Jimmy   25:57

Thanks for bearing with me on this technical enterprise. I’m hoping beyond hope, that this has recorded and we’ll be back in the saddle in Sydney, when we record next week’s.

Sue   26:12

Thanks very much, everyone.

Jimmy   26:18

Thanks for listening to the Flat Chat Wrap podcast. You’ll find links to the stories and other references on our website flatchat.com.au. And if you haven’t already done so, you can subscribe to this podcast completely free on Apple podcasts, Google podcasts, Spotify, or your favourite pod-catcher. Just search for Flat Chat Wrap  with a W, click on subscribe, and you’ll get this podcast every week without even trying. Thanks again. Talk to you again next week.

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