New movement of Da Nang real estate market

After a period of cooling down, the real estate market in Da Nang and surrounding areas has begun to show signs of new growth. As transactions increase, many investors are looking for land in the suburbs.

The market has started trading.

Some brokerage units said that in the first 3 months of 2024, although not yet bustling, the real estate market in Da Nang and neighboring areas has started to have transactions again.

Mr. Vo Trong Phung, Director of Bold Land Company Limited, said that in the FPT City Da Nang Urban Area Project area (Ngu Hanh Son district), from the beginning of 2024 until now, there have been more than 30 transactions of land plots and townhouses and villas.

According to Mr. Phung, next to FPT City Da Nang Project, Thai Duong Urban Area, Urban Area No. 3, Urban Area 1A - 1B (belonging to Dien Nam - Dien Ngoc New Urban Area, Dien Ban Town, Quang Nam) also have a "slightly" higher number of transactions than FPT City Project recently.

Mr. Nguyen Huu Duc, General Director of Protech Real Estate Joint Stock Company, said that in addition to the FPT City Da Nang Urban Area, transactions have also resumed in the Nam Hoa Xuan and Hoa Xuan areas. In particular, in the suburban areas, such as communes in Hoa Vang district, some investors have appeared to hunt for cheap land.

“In the first two months of the year, transactions increased slightly, mainly in projects with completed infrastructure and in the suburban areas of the urban center, where customers are mainly those with real needs. Meanwhile, in the suburban areas, investors outside Da Nang are mainly “hunting for land” to anticipate the trend of urban expansion according to the recently approved master plan, as well as to welcome the new wave of the market after a period of freezing,” said Mr. Duc.

According to Mr. Duc, the neighboring market of Da Nang, Quang Nam, has also begun to see active transactions in projects with good infrastructure, such as An Hoa Bay Urban Area and An Phu Urban Area. In particular, the main customers are Da Nang investors and investors from the North. This partly shows signs of recovery of the Da Nang real estate market.

Signs of recovery

Ten years ago, Da Nang was the first locality in the Central region to "thaw" to enter a new growth cycle of the real estate market (from late 2014 to 2019). Therefore, in the first months of 2024, investors are very hopeful for a new upturn in the Da Nang market, especially after the revised Land Law, Housing Law and Real Estate Business Law were passed by the National Assembly and the Government took steps to remove difficulties for the market.

Mr. Vo Trong Phung assessed: “10 years ago, the Da Nang market benefited from the effect of the 30,000 billion VND credit package to support the real estate market nationwide, now, the 120,000 billion VND credit package for social housing loans is also gradually stimulating the market. Not to mention, banks have lowered lending interest rates. Those are the similarities compared to 10 years ago to believe in a market recovery.”

According to Mr. Phung, previously, the Da Nang market began to recover when investors took advantage of the reduction in lending interest rates to conduct speculative activities and short-term investment in cheap land products in the new urban areas of Hoa Xuan and Nam Hoa Xuan. Following the market fever, investors gradually expanded their speculation and short-term investment to neighboring areas such as Dien Nam - Dien Ngoc New Urban Area (Dien Ban Town, Quang Nam), and the areas of Hoa Chau, Hoa Tien, and Hoa Lien communes (Hoa Vang District, Da Nang). However, at present, speculation and short-term investment will be difficult to occur because new laws restrict many activities that have the potential to destabilize the market.

“The fact that banks have lowered lending rates, as well as the fact that the demand for residential land is increasing rapidly due to the process of mechanical migration and urbanization in Da Nang, will be the basis for believing that the market will soon recover. This can be seen when recently, affordable apartment products have received the attention of customers and have a large amount of liquidity,” Mr. Phung analyzed.

Sharing the same view, Dr. Nguyen Van Dinh, Vice President of the Vietnam Real Estate Association, commented: “About 20 mechanisms and policies to support the real estate market issued in 2023 will have a positive impact in 2024. In addition, the move to lower deposit interest rates to a record low by banks will cause a significant amount of money currently hiding in banks to seek other investment channels, including real estate.”

For his part, Mr. Doan Thanh Phong, Sales Director of Minh Minh Group Joint Stock Company, said that the Da Nang market and its vicinity have gradually passed the most difficult period to move towards a new, longer-term and more sustainable development phase.

“Tightening legal regulations on real estate trading and business, as well as through market screening in recent years, will help investors see the capacity of investors and the potential of each specific project to make the right and accurate decisions when investing in the market. In addition, investors will focus more on infrastructure and legality, adjusting prices to suit market demand. Combined with that are support policies and capital from the State. That will be the premise for real estate in Da Nang and surrounding areas to enter a new recovery cycle,” Mr. Phong predicted.

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