Experts expect land in 2024 to make the market flourish

Low supply, high demand

The real estate market in the Southern region has recently faced many difficulties, the legal process of projects has not been smooth, the cash flow into real estate has slowed down, causing the entire market to be illiquid. The segments of this industry are considered to be the least developed in the past 5 years.

However, experts assess that the land market still maintains stability, attracts investors and the land channel brings long-term value so it is trusted.

According to DKRA's market research report, the land segment in 2023 will welcome 22 projects with a supply of about 1,850 plots, down 73% compared to 2022, this is the lowest level in the past 5 years.

Consumption reached about 751 plots, approximately 41% of the total newly launched supply, down 84% compared to the previous year. Transactions occurred mainly in the product group with prices of 12.9 - 14.9 million VND/m2 and common areas from 70 - 90 m2.

The suburban land market continues to hold a dominant position, mainly concentrated in Binh Duong, accounting for 47% of the total market supply. The primary price level recorded a decrease of 10% - 13% compared to 2022.

The secondary market recorded a decrease of 13% - 17% compared to the beginning of 2023, however, this decrease occurred locally in the group of customers using loans, as well as in some large-scale projects with incomplete infrastructure and legal procedures.

Mr. Ha Van Thien, Deputy General Director of Tran Anh Group said, “Currently, although the real estate market is facing many difficulties, that is the general picture of the whole market. However, in the real estate segments, land is still the channel that attracts cash flow and creates very high liquidity.”

According to Mr. Thien, many forecasts say that the land fever cycle may appear in the period 2025-2026, however this depends on many factors.

Meanwhile, banks have now reduced interest rates, industries will gradually recover in 2024, land is also a segment with sustainable, long-term value accumulated over the years, so investors in this segment are increasingly waiting.

Real Estate - Experts expect land in 2024 to make the market flourish — Land is still expected to develop sustainably in 2024.

“In 2024, real estate is predicted to have many bright colors, but we cannot expect massive development or rapid recovery. Instead, the market will gradually recover, going slowly and steadily to create momentum for sustainable development in the future,” Mr. Thien shared.

Amended Real Estate Law helps make land market transparent

Recently, the National Assembly passed the Law on Real Estate Business (amended), effective from the beginning of 2025, regulating the tightening of land subdivision and sale, which also shows that the adjustment of land fever is gradually being implemented.

With the number of land subdivisions and land sales in urban areas booming in recent years, this tightening of land subdivision affects the entire market from North to South and land plots may no longer witness as many land fevers as before.

Specifically, according to Clause 6, Article 31 of the draft Law on Real Estate Business (amended), it will not be allowed to transfer land use rights to individuals in wards, districts, and cities of special, type I, type II, and type III urban areas. The scope of application is expanded compared to current regulations (in special type urban areas and type I urban areas directly under the Central Government).

According to most experts, this regulation will likely contribute to increasing pressure on the new supply of subdivided land to the market in the coming time.

However, the above move also brings certain benefits, which is a premise to help the real estate market in general and the land segment in particular develop sustainably in the long-term vision.

Real Estate - Experts expect land in 2024 to make the market flourish (Figure 2). — Many projects still hang signs selling land at affordable prices to attract investors.

According to Mr. Le Dinh Lang, Director of Song Long Real Estate Investment, Construction and Development Company Limited, “The revised real estate law will have a great impact on the real estate market, helping to increase transparency in buying and selling, especially in the subdivision and sale of land. Specifically, the law helps to strengthen state management control over subdivision and sale of land; ensure uniformity in architectural aesthetics and urban planning (houses must be built on land before being sold to buyers); ensure rational and effective use to avoid wasting national land resources…”

Mr. Ngo Quang Phuc, General Director of Phu Dong Group also commented: "Currently, the amended land law has been passed, which is very helpful for the real estate market, especially in terms of transparency in real estate development stages."

According to Mr. Phuc, in 2024, in addition to the apartment segment, land plots are also expected and assessed by experts to continue to lead the market.

“The psychology of investors and people for a long time has been to accumulate assets, specifically land, houses… that’s why when bank interest rates decrease, cash flow is released into circulation, investors will look to land for investment because this segment brings very sustainable and long-term value. Meanwhile, the value of land is no longer hot, virtual, so land buyers will find areas with affordable prices, suitable for the story of asset accumulation,” Mr. Phuc commented.

Real Estate - Experts expect land in 2024 to make the market flourish (Figure 3). — Subdivision projects with well-built infrastructure are expected to be a large source of supply for the real estate market, attracting cash flow from investors.

According to Mr. Pham Lam, CEO of DKRA Group, in 2024, the new supply of land plots will continue to be scarce. The new supply fluctuates around 2,900 - 3,100 plots, mainly concentrated in Long An, Dong Nai and Binh Duong.

Market attention will focus on products developed by reputable investors with strong financial potential and projects with completed infrastructure and legal procedures. Land prices remain stable, with little chance of a sudden price increase in 2024.

“The scarcity of supply will help the land segment gain value and attract buyers in 2024. It is expected that this market will flourish and pull in many other real estate segments this year,” Mr. Lam shared.

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