(Dan Tri) - According to experts, the current cost of land tax, construction, investment, etc. is increasing, making it difficult for apartment prices to decrease. At the same time, investors are expecting higher profits, due to the high investment costs.
Apartment prices continue to increase
According to data from a market research unit, in the past 9 months alone, the total supply of newly launched apartments in Hanoi reached more than 19,000 units, exceeding the total supply for the whole year of 2023. With this abundant supply, this year could end the cycle of housing supply scarcity in Hanoi over the past 4 years. It is expected that this year, the whole country will have a supply of nearly 30,000 apartments.
Despite the increase in apartment supply, the selling price level in Hanoi continues to record an upward trend in both the primary and secondary markets. In the primary market, the average selling price reached 64 million VND/m2 (excluding VAT and maintenance fees), 3% lower than in Ho Chi Minh City.
In the secondary market, the average selling price continued to increase from the previous quarter, reaching VND46 million/m2 (excluding VAT and maintenance fees), up 5.5% quarter-on-quarter and nearly 26% year-on-year. The increase in secondary selling prices shows no signs of stopping and is currently only about VND2 million/m2 away from the secondary apartment price in Ho Chi Minh City.
Many apartments have increased their selling prices by hundreds of millions of dong after only one month (Illustration: Duong Tam).
According to a survey by Dan Tri reporters, over the past month, apartment prices in Hanoi have continued to increase and show no signs of cooling down.
Specifically, a 64m2 house with 2 bedrooms at Vinhomes Smart City project in mid-September was advertised for sale at around 4.2 billion VND. Up to now, the same house is being advertised for sale at prices ranging from 4.5 billion VND to 4.7 billion VND.
Or at the Thang Long Number One project, an 87m2 apartment with 2 bedrooms was advertised for sale at the end of September for 5.7 billion VND. However, the price of this apartment has now been increased to 6 billion VND.
In need of buying a house, Mr. Nguyen Van Ngu (from Nam Dinh) said that for the past 3 months, his family has been continuously looking at many apartments in Nam Tu Liem and Ha Dong districts. With a budget of about 3 billion VND, Mr. Ngu plans to buy an apartment of about 65-70 square meters, designed with 2 bedrooms.
"The more I look, the higher the price offered by the owner becomes. For example, a house with an area of 68 square meters in My Dinh (Nam Tu Liem, Hanoi) was advertised for sale in August for about 3.3 billion VND. The owner is offering the same house for sale for 3.7 billion VND," he said.
Why is it difficult for apartment prices to decrease?
Real estate expert Tran Quang Trung said that many people are still waiting for apartment prices to drop, but this wait seems impossible. Because all input factors of project development enterprises such as land tax costs according to the new price list, construction costs, investment in product design... are all increasing significantly.
In the context of increasingly scarce land funds, to own a beautiful location, especially in the center, businesses have to spend a large amount of money. When land prices are high, investors making a popular product will certainly lose money. With beautiful locations, project developers must make products worthy of that location, so there is no cheap price.
An apartment project in Hanoi (Photo: Duong Tam).
Ms. Nguyen Hoai An - Senior Director of CBRE Vietnam - said that most of the newly launched projects are located in existing urban areas with high prices. In addition, the high selling prices are partly due to the large investment demand, and cash flow is still pouring into products serving real housing needs in the center. Therefore, market liquidity is still maintained positively.
When launching new products, investors will carefully calculate the selling price correlation with the area, so new buildings are unlikely to have lower prices than the previous phase or surrounding projects. This is to ensure the expected profit of investors in the context of increasing material costs.
According to Dr. Nguyen Van Dinh - Chairman of the Vietnam Association of Realtors (VARS), the supply of apartments in Hanoi has increased in recent times but still cannot meet the needs of the people. In addition, most of the new supply continues to be completed at high standards with high investment costs and land costs.
With the current high investment costs, investors also expect higher profits than before. Therefore, the price level of primary apartments is very difficult to decrease. The high price of apartments in the primary market has led to a sudden increase in prices in the secondary market.
Explaining the reason why real estate supply has increased but prices have not decreased, at a recent press conference of the Ministry of Construction, Mr. Vuong Duy Dung - Deputy Director of the Department of Housing and Real Estate Market Management (Ministry of Construction) - said that real estate supply is only one of the reasons for the increase in real estate prices in some areas and localities in recent times.
According to him, the increase in real estate prices is partly due to recent fluctuations in land-related costs as well as the impact of applying new calculation methods and land price lists. In addition, there is a phenomenon of many investors forming associations and groups to participate in auctions; paying land prices many times higher than the starting price, and then possibly "abandoning deposits" after winning the land auction with the aim of establishing a virtual price level in the area to make a profit...
"The auction of land use rights with the winning bid being many times higher than the starting price will have the impact of increasing the land price level, real estate price, and housing price in the neighboring area. At the same time, this also increases the cost of implementing housing projects, causing difficulties for businesses, reducing supply, and negatively affecting the real estate market," he said.
Source: https://dantri.com.vn/bat-dong-san/chung-cu-o-ha-noi-bot-khan-hiem-nhung-gia-rao-ban-van-cao-chot-vot-do-dau-20241024155319977.htm
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