Hanoi welcomes 'flock' of new projects, but housing prices are still difficult to decrease, against market rules

(CLO) According to the law of the market, when supply is stable and increasing, housing prices will cool down. However, this law does not apply to housing prices in the Hanoi real estate market.

Hanoi welcomes a flood of new projects

The Hanoi People's Committee has just issued a Decision approving the update of the list of housing and urban area construction investment projects in the city's Housing Development Plan for the period 2021-2025 (phase 4).

Of which, Hanoi has approved investment policies for 11 projects, including 4 projects under implementation expected to be completed in the 2021-2025 period and 7 projects expected to be completed after 2025.

According to the rules of the market, when supply is stable and increasing, housing prices will cool down. (Photo: ST)

The decision also specifically states a list of 44 projects undergoing investment preparation procedures, with a total residential floor area of ​​more than 3.9 million square meters, providing 13,553 units to the market.

Regarding the completion progress, the 2021-2025 period will have 468,919 m2 of completed housing floor area, equivalent to 1,012 units. After 2025, the expected completed housing floor area will be more than 3 million m2 with a supply of up to 8,787 units.

In recent years, the supply of new apartments in Hanoi, although increasing, is still low and cannot meet the needs of consumers. Not to mention, most of the new apartment supply is in the mid-range, high-end and super-luxury segments, while the affordable segment is almost "extinct" in the market.

Therefore, projects that have been approved for investment and projects under investment will create new momentum for the Hanoi real estate market to break through in the coming time.

According to forecasts from market research companies, in 2025, Hanoi will have a "flood" of new projects opening for sale. Specifically, CBRE forecasts that in 2025, the new supply of apartments in Hanoi is expected to continue to be abundant, estimated at more than 31,000 units, higher than in 2024.

Are house prices going down?

According to the law of the market, when supply is stable and increasing, housing prices will cool down. However, this law does not apply to housing prices in the Hanoi real estate market.

According to CBRE's forecast, although the supply of new apartments in Hanoi in 2025 will be more abundant than in 2024, it will mainly focus on the high-end and luxury segments, while the affordable segment is still lacking. Therefore, primary selling prices are expected to increase by about 6% - 8%.

Not to mention, some other factors that cause apartment prices to continuously increase, such as the long time to complete legal procedures, resulting in a long project approval process, from site clearance to completion of legal procedures. This increases investment costs, thereby pushing up real estate prices.

In addition, inflation, rising material prices, exchange rates, and recently land prices have also become factors that make it difficult for housing prices to decrease in the near future.

Faced with the reality of rising real estate prices, Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, recommended that close coordination between management agencies, businesses and the community is needed to balance supply and demand.

On the supply side, it is necessary to increase the supply of affordable housing, improve infrastructure in suburban areas and develop effective financial support policies. Authorities at all levels, especially localities, need to create conditions for the development of affordable commercial housing and social housing to attract investment.

On the demand side, people need to have a clear financial plan, take advantage of support programs and be flexible in choosing a place to live. Only then can the housing problem be effectively solved, bringing benefits to both individuals and society. Expanding demand to the suburbs, where prices are lower, is also an effective solution. With investment in transport infrastructure such as highways and metro, suburban projects still ensure convenient connections to the center.

In addition, renting a house is a suitable temporary option to save money and avoid the burden of paying off a mortgage. People should spend no more than 1/3 of their income on rent to balance their lives.

Finally, people can take advantage of support policies such as flexible payments, preferential interest rates and home loans when they have accumulated about 50% of the house value. This helps reduce financial pressure and realize the dream of home ownership.

Source: https://www.congluan.vn/ha-noi-don-o-at-du-an-moi-nhung-gia-nha-o-van-kho-giam-trai-quy-luat-thi-truong-post330969.html