Experts said that the land fever to push up prices may still continue. Especially the land plots around the big cities when transport infrastructure projects are being promoted.
Mr. Nguyen Manh Khoi, Deputy Director of the Housing and Real Estate Market Management Department (Ministry of Construction) said that the economic recovery program is an opportunity for the real estate market. One of the factors affecting the real estate market the most is capital. With the 2% interest rate support package of commercial banks for businesses when borrowing from banks for project development, it is expected that about VND 40,000 billion to support or VND 15,000 billion to support tenants and home buyers. With low-interest rates lead to concerns about where to get the supply to let people buy social housing.
This means that in order to disburse VND 15,000 billion, there must be a supply of social housing for the people. Thus, we worry that in 2 years, we will spend 15,000 billion, must take into account the supply?
In addition, there is an indirect support package of 114,000 billion through infrastructure investment. Infrastructure investment first affects the economy, then real estate.
“When the transport infrastructure is adequate, real estate will develop. It is no coincidence that the provinces have land fever, real estate projects develop because of the promotion of transport infrastructure. And it should be understood that the real estate market is not only housing but also tourism real estate, industrial real estate, industrial parks, and resorts will develop”, Mr. Khoi said.
Mr. Nguyen Van Dinh, Vice Chairman of the Vietnam Real Estate Association, and Chairman of the Vietnam Real Estate Brokers Association acknowledged that the fact that a series of localities stepped in to prevent land fever in the market was a positive signal. It helps stabilize land prices and directs the market to healthy development. At the moment, land prices are no longer as hot as the first three months of the year.
“In the first quarter of the year, the land plot market was still quite active with national interest increasing by 4% compared to the period of 2019. Many localities increased significantly both in terms of purchase and sale of land like Khanh Hoa, Binh Thuan, Thanh Hoa. However, entering April 2022, the level of interest in land plots across the country has dropped sharply by nearly 20% compared to the previous month,” Dinh said.
However, forecasting land price movements in the last months of 2022, Mr. Dinh said that land fever to push up prices could still continue. Especially the land plots around the big cities when transport infrastructure projects are being promoted. Even at the present time, the price of land in the suburbs of Hanoi is rising.
Mr. Dinh said, the cause of land fever, blowing prices, is partly because investors are expecting too high profits, so they directly push up the selling price. On the other hand, real estate is being considered a safe investment channel in the context of complicated developments in the world market. Not to mention, public investment in 2022 has been rapidly deployed, many new projects have been formed, and unfinished projects have been accelerated, which has created a positive signal for the market but also pulled real estate prices neighbors “follow”.
Accordingly, the expert said that, in order to ensure that the land price in the near future is stable, and in line with real demand, local authorities need to continue to drastically control all land use activities. , investment projects, land transactions… to ensure compliance with legal regulations; provide full information on economic development policy, planning, and land use plan in the area.
Mr. Dinh said that it is necessary to attach the responsibility of local leaders to the situation of buying and selling agricultural land, non-agricultural land, and residential land in contravention of the law to avoid leading to the phenomenon of virtual land fever. Local governments also need to regulate real estate exchanges and brokers more closely and effectively.
Dr. Su Ngoc Khuong, Senior Director, Investment Division, Savills Vietnam said: “It can be seen that the supply in the market in recent years has been very limited for many different reasons. This also leads to the price of products on the market being pushed up, beyond the ability of many people to pay.”
Currently, there are two main groups of customers in the market, Mr. Khuong said. One is a customer buying to live in and the second is a customer buying to invest instead of depositing money in banks, securities,…
Therefore, the investment in the housing market, especially apartments, is very high. This situation occurs not only in two big cities, Hanoi and Ho Chi Minh City but also in neighboring provinces. Therefore, in the near future, the supply in the market will be limited. According to Savills’ Market Report for the first quarter of 2022, real estate prices in all segments tend to increase.
The Savills expert said that due to limited supply in the market, other investment channels are no longer attractive and the demand for housing is large, it is forecasted that the real estate market will face difficulties in the coming time, especially for those who buy with real housing needs.
“From now until the end of the year, the market will not change: the supply is short, the selling price remains high, the liquidity is slow. Firstly, the land fund to develop new projects is limited. In addition, projects are congested due to legal issues. The third reason is that investors push the expected return too high.
These problems lead to low liquidity because people’s ability to pay is limited. However, it should also be noted that compared to 2012 and 2013, the transaction is still more; For June and July every year, the liquidity in the market is not high,” emphasized Mr. Khuong.
However, according to Mr. Khuong, the limited supply will create favorable conditions for urban areas around Hanoi and Ho Chi Minh City. Ho Chi Minh City developed. Because these are areas with large land funds, transactions are more convenient and prices are more flexible, thereby improving liquidity.
Source: CafeF
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Source: Vietnam Insider