Be careful with land fever due to merger effect

Before the news of merging provinces and communes to expand development space, the real estate market in many localities suddenly "heated up" again after a long period of stagnation. This is considered a new opportunity for investors, promising to bring large profit margins and high liquidity in response to the relocation needs of cadres, civil servants, public employees and workers. However, in order to avoid falling into the price inflation matrix, investors need to be extremely cautious and consider carefully the current conflicting information.

Land products in Nam Vinh Yen urban area are being sought after by investors, causing land prices to increase dramatically.

In recent days, in the Nam Vinh Yen urban area, land prices are heating up day by day. A Facebook account named Thuy Do posted that the price of a 100 m2 plot of land on a 16.5m road, close to Ly Nam De street in the Nam Vinh Yen urban area is 4.x billion VND, a price of more than 40 million VND/m2. A few hours before, this Facebook also posted a 240 m2 plot of land, 8m frontage, for sale at more than 8.4 billion VND, equivalent to a price of more than 35 million VND/m2.

In just a short time (before and after the Lunar New Year of At Ty), the selling price of land plots in Nam Vinh Yen urban area has tended to increase sharply, an average of 15 - 30%. These are unusual signals even though the urban infrastructure in the past has not had many breakthroughs. Information about the ecological urban area project invested by VinGroup in the Sau Vo lake area is only in the investment research stage.

Mr. Phan Van Hung, representative of Sea Holding Investment and Trading Joint Stock Company (Vinh Yen), a unit with many years of experience in real estate business in Vinh Yen, said: Before the information about merging provinces and communes according to the Government's policy, the real estate market in the province has recorded a revival.

Land prices in many areas in the province have recorded high increases, ranging from 15 - 20% of the total value. In particular, in the Nam Vinh Yen urban area, some plots have increased in price up to 1.5 times compared to before the Lunar New Year.

Information about successful transactions appears more and more on social networking sites. However, with such strong fluctuations, the risk rate will be very high, investors need to be alert, research scientific and optimal financial plans to ensure the least risk. At the same time, there needs to be a full assessment of infrastructure and development vision so that short-term or long-term investments can proactively liquidate when necessary.

In the past 10 days, the land market in Viet Tri city, Phu Tho province has witnessed a strong price increase, especially in some suburban areas. Land prices in central wards such as Thanh Mieu, Gia Cam, Trung Vuong, Bach Hac, Tho Son... have increased by 20 - 30%, even some areas with synchronous traffic infrastructure recorded an increase of up to 50% compared to the end of 2023.

Land prices change hourly, even overnight each plot of land has increased in price by tens to hundreds of millions of dong, although the Phu Tho real estate market has been stable for many years. The reason is due to the effect of information predicting the merger of Vinh Phuc and Hoa Binh provinces into Phu Tho, the headquarters of agencies will be located in Viet Tri city, to catch the investment wave, many investors in the province have quickly learned about the opportunity to invest in land in Viet Tri, expecting that in the coming months the selling price will increase to make a profit.

Many experts in the real estate industry analyze that merging provinces and cities will not create an earthquake in land prices, because the nature of merging only expands the development space for the new locality, not changing the economic situation too much.

While merging to streamline the apparatus, the number of civil servants, public employees and workers in the State sector will decrease significantly, which leads to the demand for real estate in new administrative centers not increasing as much as investors expect.

Reality has proven this, as in the case of the merger of Ha Tay and Me Linh into Hanoi city in 2008. At that time, many people expected land prices in Ha Dong, Son Tay or Me Linh to "break out" immediately after the merger, however, in reality it took 10 - 15 years for land prices to increase thanks to investment in infrastructure development and the dynamism of the local economy.

It can be seen that the effects of the information on province mergers have had and are having multi-dimensional impacts on the real estate market. Making the real estate “waves” appear more and more frequently and stronger.

In particular, that heat combined with the information that the province has continuously started social housing projects in Phuc Yen and Vinh Yen cities and the information that VinGroup Corporation is preparing to invest in an urban area in the Sau Vo lake area with an area of ​​2,500 hectares in the recent past has also contributed to creating a new "land fever".

To do business safely and effectively, ensuring social security issues, investors need to be extremely careful, avoiding falling into a situation where they are trapped by the increasingly sophisticated price-inflating tricks of land brokers.

Article and photos: Duc Chung

Source: https://baovinhphuc.com.vn/Multimedia/Images/Id/125468/Can-trong-voi-con-sot-dat-do-hieu-ung-sap-nhap