Declining real estate supply will cause prices to continue to climb

According to the May 2024 market report of Dat Xanh Services Institute of Economics - Finance - Real Estate (DXS - FERI), new supply in the whole market showed signs of decline. In particular, the total primary supply in May decreased by 0.73% compared to April, reaching 47,458 units. The new supply was only about 38.5%, mostly coming from the mid-range and high-end apartment segment.

Because the newly opened projects in the period mainly come from the mid-range segment and above, they contribute to increasing the average selling price in major markets such as Hanoi , Ho Chi Minh City, Da Nang, Can Tho, etc. Besides, the "dripping" supply at the present time has also affected the selling price of some types in the market.

Regarding the apartment type, except for Hanoi and neighboring provinces, which maintained stable prices during the month, other provinces and cities had significant increases. In which, the Central region fluctuated from 29 - 104 million, up 4-6%; Ho Chi Minh City and neighboring provinces fluctuated from 29 - 82 million/m2, up 1 - 2% and the Western region had prices ranging from 31 - 45 million/m2, up 3 - 5%.

Except for the Hanoi market and neighboring provinces, most other areas recorded price increases for apartment types.

For townhouses, the selling price in Hanoi and the suburbs ranges from 40 to 176 million VND/m2, up 3 to 4%; in Ho Chi Minh City and neighboring provinces ranges from 31 to 103 million VND/m2, up 3 to 5%. Meanwhile, in the Central and Western regions, prices remained stable compared to April.

As for the type of land that many investors are interested in, there has not been much change in price in large markets such as Hanoi and Ho Chi Minh City. In the Central region, the price is recorded from 14-54 million VND/m2, an increase of 3-5%.

Meanwhile, the shophouse market is relatively stable, only recording an increase of 3-4% in the Hanoi market and neighboring provinces, prices ranging from 34-242 million VND/m2. As for the villa type, the highest price increase was in Hanoi and Ho Chi Minh City, reaching about 29-231 million VND/m2 (up 5-7%) and 63-329 million VND/m2 (up 3-5%), respectively.

DXS - FERI's report also forecasts that in June 2024, a number of high-end and luxury projects will be officially opened for sale while new supply from affordable and mid-range projects is increasingly limited and social housing projects have no plans to open for sale, so the price level is expected to continue to escalate.

Villas are the type of property with the highest price increase.

However, the bright spot in the market is that the average absorption rate of new supply increased sharply compared to the same period, reaching an average of 58-62%. This growth comes from the relatively scarce new supply, coming from projects with prime locations and high liquidity. In addition, after being launched for sale, projects continue to announce preferential sales policies to accelerate the consumption rate. Many investors have offered strong discounts, up to 30%, which has significantly contributed to improving the absorption rate in May.

The research unit also stated that market sentiment is showing signs of improvement in a more positive direction as investors are urgently implementing announcements and opening sales of projects that have met legal conditions; brokerage units are actively recruiting, strengthening cooperation, expanding locations, types, and product segments... In particular, customers with good financial capacity quickly make purchase decisions when there are suitable products, even in some projects with quite high selling prices.

Source: https://www.congluan.vn/nguon-cung-bds-sut-giam-khien-mat-bang-gia-se-tiep-tuc-co-xu-huong-leo-thang-post298396.html