Real estate businesses say real estate prices are 'too high', need to be brought back to real value

Real estate businesses believe that they must focus on real estate products with real value, real housing.

Many apartments in Ho Chi Minh City cost tens of billions to hundreds of billions of VND each - Illustration: NGOC HIEN

At the seminar "Market Identification real estate late 2024 and early 2025" by the newspaper Workers At the event held on October 10, Mr. Ngo Huu Truong - Deputy General Director of Hung Thinh Corporation - proposed solutions to bring real estate back to its real value.

According to Mr. Truong, the real estate market is still suffering many losses, customers are affected and market confidence has not yet recovered.

On the investor side, many real estate companies are facing legal difficulties, large inventories and disrupted cash flow.

In addition, the implementation of new projects as well as the handling of old backlog issues still face obstacles, leading to increased costs; the longer the legal waiting time, the higher the costs.

To resolve market difficulties, Mr. Truong said that businesses must cooperate extensively and increase mergers and acquisitions to attract new capital sources.

The most important thing is how to resolve legal problems quickly and effectively, reducing costs.

Regarding solutions for real estate businesses, Mr. Truong believes that it is necessary to choose the right market, the right segment and target the right potential customers.

"Businesses must return to reality, how to have real houses, real real estate and its true value.

At the same time, it is necessary to choose the right drop point so that the project can be handled quickly, neatly and efficiently. absorb "Okay," said Mr. Truong.

In addition, Mr. Truong said that it is necessary to price correctly, returning to real value, unlike the previous period when "when the market went up, 1-2-3 of us went up together".

According to Mr. Truong, businesses need to balance investment costs and reasonable profits to set the right price.

"The four projects licensed this year are all high-end, for example, the old District 2 area is up to 10,000 USD/m² (equivalent to 250 million VND/m²), which is too high," said Mr. Truong.

Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association - said that to reduce housing prices, it is necessary to increase housing supply, especially affordable housing.

But to increase supply, we must resolve more than 148 projects that are stuck and have backlogs. For example, a project with 1,000 apartments will add up to 148,000 new apartments to the market, which will directly regulate the market and reduce housing prices.

"HCMC and businesses need to increase housing products, especially affordable housing products. At the same time, if 1 million social housing units are successfully implemented, housing prices will decrease," said Mr. Chau.

Source