(CLO) Vietnam's real estate market has "closed" 2024 with positive recovery results thanks to major steps in perfecting the legal corridor, with increasingly transparent and clear information for all participants.
The market is heating up gradually at the end of the year.
The year 2024 marks the rise of the Vietnamese economy after a period of recovery and stable growth. With positive macroeconomic indicators, investors' and people's confidence in the economy has been strengthened. The real estate market is no exception to this trend, becoming one of the leading sectors, contributing greatly to the overall development.
Accordingly, the real estate market in 2024 has passed the most difficult period with many positive recovery results and is still closely following the recovery process with much room for future growth thanks to the driving force from supporting factors from the macro economy, management policies, and market demand.
Vietnam real estate closes 2024 with many big steps forward. (Photo: ST)
At the end of the first quarter of 2024, the market welcomed a large number of real estate brokers and real estate trading floors returning to "operate" the market when investors began to activate the implementation of a series of projects with increasingly large scales. Some projects with good implementation progress have officially received deposits. Newly opened projects, from land products, townhouses, villas, apartments, etc., all recorded good growth in interest, transactions and selling prices in both the primary and secondary markets.
In the second quarter of 2024, the recovery momentum of the real estate market continued to be maintained, with supply and transaction volume in the quarter growing strongly, 3 and nearly 4 times higher, respectively, than the same period in 2023.
In particular, the information that the 2024 Land Law, the 2023 Housing Law, the 2023 Real Estate Business Law and Clause 2, Article 209 of the Law on Credit Institutions will take effect 5 months earlier, further adding to the confidence of entities operating in the real estate sector to be "ready to re-enter the game".
By the third quarter, legal regulations on housing, land and real estate business were officially "pressed" into effect, eliminating the "before G hour" mentality of the entire market. The market also began to record signs of "heating up" with the story of land auctions in the suburban areas of Hanoi "hotter" than ever. The heat of the market is also led by the apartment segment, with prices continuously increasing, establishing new levels in both the primary and secondary markets.
By the last quarter of the year, due to the "warming" of the market, many real estate investors changed their plans, "launched" products earlier than expected, with many preferential policies, helping the housing supply "exceed" forecasts.
Supply grows strongly year by year
According to the report of the Vietnam Association of Realtors (VARs), the supply of residential real estate in 2024 will grow strongly year on year with an increasing number of large-scale projects opening for sale at the end of the year with preferential and flexible payment policies. At the end of 2024, the real estate market recorded about 56,000 products offered for sale in the primary market, equivalent to the end of 2023 due to many projects "releasing" a large amount of inventory in the context of market recovery.
In 2024, the entire market recorded nearly 81,000 products for sale, an increase of more than 40% compared to 2023. Of which, there were 65,376 new products for sale, about 3 times higher than in 2023, but only about 7% compared to 2018 - a year before the pandemic. In the fourth quarter of 2024 alone, the market recorded 28,000 new products for sale, 2 times higher than the previous quarter and 4 times higher than the same period in 2023.
Transaction volume in 2024 will also continue to grow steadily as supply improves in both quantity and quality. The demand for real estate, including for living and investment, is very high and is constantly increasing with the speed of urbanization and economic development, on the basis of a completed legal corridor. In 2024, the whole market recorded more than 47,000 successful transactions, equivalent to an absorption rate of 72%. With more than 50% of primary transactions contributed by investment demand. Of which, there is a certain amount of speculation.
In terms of transaction structure, luxury apartments (CHCC) dominate the market share, accounting for 75% of total market transactions. New projects have very good absorption rates, reaching over 70%. In particular, many projects recorded absorption rates of up to over 90% on the official opening day.
Many CHCC products are even “transferred” even before or after signing a sales contract. Towards the end of the year, the number of transfers in this form increases due to improved supply, and speculators who “surf” apartments “cut losses” - in fact, “cut profits” or break even, due to financial pressure.
The supply of residential real estate in 2024 will grow strongly year on year with more and more large-scale projects opening for sale. (Photo: ST)
Low-rise transactions also improved strongly in the context of market recovery, the absorption rate of newly launched projects was at a very good level, estimated at nearly 65%, equivalent to nearly 9 thousand transactions.
In the secondary market, liquidity is mainly concentrated in products that serve real housing needs and can be "occupied immediately". In large urban projects with residents living there with modern, synchronous infrastructure and utilities. Individual housing products with guaranteed legal status, priced under 4 billion VND in major cities.
In the land segment, transactions mainly arise in the secondary market, when the new legal corridor forces investors to build houses for sale. Large plots of land without legal documents are "cut at a loss", while plots of land that have been divided into plots and have legal guarantees are "hunted" by investors.
In addition to “profit-taking” transactions, the number of secondary transactions also increased sharply when investors accepted the “pain” once, boldly “cut losses” on assets that do not generate cash flow or have low potential for price increase such as land far from the center, unfinished projects to restructure the investment portfolio, allocate assets to assets with business potential, exploit for rent, and generate cash flow.
VARs assessed that, in general, the real estate market "closed" 2024 with positive recovery results thanks to major steps in perfecting the legal corridor, along with close direction and management of the Party, State and Government.
Up to now, the real estate market is still moving positively. Market liquidity is showing a slight downward trend in the high-end segment, but remains stable in housing products that meet real housing needs, with reasonable value, with components including technical infrastructure, social infrastructure, trees, lakes, entertainment areas, commerce, management, security, etc.
VARS believes that in order for the market to recover and develop in a safe, healthy and sustainable direction, investors need to ensure prices are suitable for the market's purchasing power, instead of focusing on short-term profits.
Source: https://www.congluan.vn/bat-dong-san-viet-nam-khep-lai-nam-2024-voi-nhieu-buoc-tien-lon-post328396.html
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