Cash flow into real estate still faces difficulties

Despite many positive signs, the real estate market still faces many challenges. In particular, factors related to cash flow are forecast to continue to face difficulties.

On August 29, sharing at the Seminar with the topic: "Identifying cash flow and catching the real estate wave", experts said that although there have been many positive signals, the Vietnamese real estate market still faces many challenges. In particular, factors related to cash flow are forecasted to continue to face difficulties this year.

According to experts, from now until the end of 2024, the real estate market will still face many challenges.

Specifically analyzing this statement, Dr. Dinh The Hien - an economic expert, said that in the first half of 2024, there were many positive drivers for cash flow. These include: GDP in the second quarter of 2024 increased by 6.97%; Social development investment capital in the second quarter also increased higher than in the first quarter, the total of the two quarters was 1,451 billion VND, an increase of 2% over the same period last year.

Besides, there are other positive drivers such as public investment disbursement in the first 7 months of 2024 is still low, reaching only 44.7% of the plan. This is an important resource for the last months of the year. Next is FDI capital disbursed in the first 7 months of 2024 reaching 12.56 billion USD, up 8.4% over the same period.

“FDI capital flows are concentrated in the electronics and industrial sectors. This shows that Vietnam continues to attract foreign companies. Moreover, exports remain a strong driving force, reaching 226.9 billion USD, up 17.7%. Trade surplus reached 14.08 billion USD. The average CPI in the first 7 months of the year was 4.12%, which will facilitate investment cash flow,” Dr. Dinh The Hien shared.

However, there are still limited impacts on cash flow. For example, the pressure to repay corporate bonds in 2024 is still high. Banks will increase bad debt in 2024, limiting credit to companies with poor business performance.

According to Dr. Dinh The Hien, the total outstanding credit balance as of June 30, 2024 was VND14.4 trillion, up 6% compared to the beginning of the year. Of which, the main focus was on June with a supply of over VND487 trillion. It can be seen that the credit source in 2024 will be equivalent to previous years. However, the mobilization level only increased by 1.5%, causing the banking system to face difficulties in capital sources.

Particularly for the real estate sector, the credit situation in the first 6 months of the year reached more than VND 3,083 trillion, accounting for 21.4% of total outstanding loans, up 6.8% compared to the end of 2023. Meanwhile, outstanding credit for real estate business activities increased by only more than VND 20,700 billion compared to the end of 2023, up 1.86%.

“The accumulated outstanding debt capital is mainly buried in large projects compared to the new capital flowing into the market. Meanwhile, business activities in the market are still facing difficulties as liquidity decreases, inventories increase, and the revenue/inventory ratio is only about 2.3%,” said Dr. Dinh The Hien.

Dr. Dinh The Hien, economic expert, shared at the Seminar.

The expert added that the sharp increase in gold and USD exchange rates is also one of the factors that has caused the cash flow to stop flowing into real estate. Accordingly, the cash flow is forecast to continue to be difficult in the third quarter of 2024.

Businesses that are not doing well will have difficulty accessing bank loans. Consumption remains limited because jobs have not recovered and the middle class has to settle real estate debt.

“Cash flow will improve from the fourth quarter of 2024 when exports grow and consumption recovers. However, businesses still face difficulties in capital and markets. Cash flow will only improve positively in 2025. Bank credit will be positive from the second quarter of 2025, and investor capital will flow strongly from the second quarter of 206,” said Dr. Hien.

Commenting on market operations, Dr. Su Ngoc Khuong, Deputy Director of the Institute of Informatics and Applied Economics (IIB), said that if the market "warms up" from now until the end of 2024, it will mainly focus on the secondary market. Investors buy and resell, but there is almost no new supply, and if there is, these transactions do not represent the entire income of the people.

Entering 2025, the real estate market will depend on many macro factors and the implementation of new laws related to real estate...

“Currently, I myself cannot confirm how good the real estate market will be in 2025. This is a very difficult thing. However, in terms of image, I, like everyone else, have expectations for the future,” said Mr. Khuong.

Source: https://baodautu.vn/batdongsan/dong-tien-vao-bat-dong-san-van-gap-kho-d223673.html