Real estate enters recovery cycle

According to the survey results of 1,152 individuals working as real estate brokers conducted by the Institute for Economic - Financial - Real Estate Research (BDS) - Dat Xanh Services (DXS -FERI) in March 2024, most respondents expected the real estate market to recover soon.

Demand for housing is increasing

Specifically, 38% believe that the real estate market will recover this year, about 50% expect the market to recover in the first half of 2025. At the time of the survey, about 13% of brokers who quit their jobs returned to the industry and it is expected that 55% of brokers who quit their jobs will continue to return in the near future.

Apartments are attracting a lot of attention from customers as the real estate market enters a recovery cycle. Photo: TAN THANH

The survey results also show that most customers at this time are those who want to buy a house to live in (58%), followed by those who buy a house for long-term investment and rental (34%), only a very few are interested in short-term "surfing" (3%). The basis for their decision to buy and sell at this time is the "cheap" cash flow, meaning low interest rates and many preferential policies from investors.

According to another survey by DXS-FERI, the apartment segment continues to be the leading product line in the market. In particular, the demand for buying apartments with a price range of under 2.5 billion VND accounts for a high proportion (up to 68%), followed by apartments with a price range of under 3.5 billion VND (22%).

Experts say that this is the time when all parties are ready for the "race" and to welcome the new cycle of the real estate market. In this race, the group of investors plays a pioneering role, they compete to launch products and launch projects to increase supply to the market. However, not all investors start at the same time, but the group of foreign enterprises has "left the starting line and temporarily taken the lead", while domestic investors and new enterprises entering the market are only in the "restart" phase.

According to our records, from the end of 2023 until now, investors have continued to maintain good policies for products in the "basket" of previous sales but have gradually reduced preferential policies for products in the "basket" of new products due to higher demand from buyers for new projects.

Price is unlikely to decrease further

Regarding the market developments in the first quarter of 2024, Mr. Vo Huynh Tuan Kiet, Director of Sales Department of CBRE Vietnam, commented that 2024 is a pivotal year for the real estate market before new laws (amended Land Law, amended Real Estate Business Law and amended Housing Law - PV) related to this field come into effect.

Because it is a pivotal year, investors and customers are not sure what will happen, but prices of some segments (apartments, land plots, etc.) have shifted to an upward trend for many reasons such as the period of cheap money, market expectations, increased input costs for projects, etc.

"In my opinion, people who want to buy a house should buy early because the price will hardly decrease further. If they hesitate, they will not be able to buy good locations. As for the land segment, the new law tightens subdivision activities, the supply is limited so the price will hardly decrease" - Mr. Kiet said.

Mr. Luu Quang Tien, Deputy Director of DXS-FERI, also said that from 2024, with the pressure of sharply increasing input costs according to new regulations, primary real estate prices are on the rise. Customers and investors who hesitate may miss the opportunity to buy good-priced real estate at the beginning of the "wave". "Opportunities are always for smart and decisive investors" - Mr. Tien emphasized.

Dr. Pham Anh Khoi, Director of DXS-FERI, assessed that the real estate market is showing many positive signs and is on the path to recovery. He predicted that the market will gradually rise from the "U" bottom, the speed of recovery will depend on macro and micro factors, the most important of which is market confidence.

According to this expert, the ideal scenario for the housing segment in the second quarter of 2024 is that supply increases by 30% - 40% over the same period, floating interest rates from 8% - 10%, selling prices increase by 10% - 20% and absorption rate reaches 40% - 50%.

"2024 is a pivotal year for the market to accumulate and prepare for a new development cycle. Through each economic cycle, there is a phenomenon of "the next wave pressing the previous wave", which means that a series of old brands will decline or leave the market and a series of new real estate brands will emerge, establishing a position in the new development cycle. At this time, whoever still has good resources will overcome and make a strong breakthrough.

After a four-year purification process, only about 20% of businesses remain, most of which are well-known names with the potential to create real change for the entire industry in the new cycle," Dr. Pham Anh Khoi analyzed.

Apartment supply in Ho Chi Minh City continues to decline sharply

According to CBRE, in the first quarter of 2024, Hanoi had 2,300 apartments and 30 new low-rise houses for sale, an increase of 11% over the same period last year. Meanwhile, the apartment supply in Ho Chi Minh City was only 500 units, the lowest in a quarter in the past 15 years, only 17% of the same period last year.

Savills Vietnam's report also shows that primary supply in the commercial apartment, townhouse, and villa segment in Ho Chi Minh City in the first quarter of 2024 continued to decrease sharply by 35% compared to the previous quarter and 28% compared to the same period, to 4,922 units, after 9 projects temporarily suspended sales due to incomplete legal requirements or sales policy adjustments.

Apartment transactions were also quiet, with only 1,116 units sold in the quarter, down 63% from the previous quarter but up 29% from the same period in 2023. Of which, Class C (economy) products were popular with buyers - accounting for 61% of sales, followed by Class B (mid-range) apartments - accounting for 37%.

Source: https://nld.com.vn/bat-dong-san-buoc-vao-chu-ky-hoi-phuc-196240418193642831.htm