Many opportunities and challenges intertwine
2023 is a challenging year for the real estate market, many continuous moves from the Government and agencies have removed a significant part of the market's limitations and obstacles.
The passage of the new Housing Law (amended) with many new regulations to "remove difficulties" for buyers and investors developing social housing projects is expected to create attractiveness and attract more businesses to participate in development.
Despite many difficulties, the Vietnamese real estate market has passed its most "frustrating" period.
Market data shows that the number of searches for transactions in the land and apartment segments has recovered well and the supply from new projects and transactions is increasing.
Dr. Nguyen Van Dinh, Chairman of the Vietnam Association of Real Estate Brokers (VARS), commented that 2024 will have many intertwined opportunities and challenges.
In particular, positive movements in both total supply and total demand were recorded thanks to planning information. The participation of investors in the "race" to develop affordable housing and social housing will also gradually narrow the gap between supply and demand.
In the coming time, the development of social housing will continue to have more positive results with "support" from policies.
The passage of the new Housing Law (amended) with many new regulations to "remove difficulties" for buyers and investors developing social housing projects is expected to create attractiveness and attract more businesses to participate in developing this segment.
As well as increasing access to this type of service for low-income people.
Recently, according to a report by real estate services group DKRA (DKRA Group), in Ho Chi Minh City and surrounding areas, the primary real estate market recorded a significant decrease in both supply and consumption in key segments.
The Government's moves to remove difficulties for the market such as Resolution 33/NQ-CP, Official Dispatch No. 469/CD-TTg, Circular 02/2023/TT-NHNN, Circular 03/2023/TT-NHNN, etc. are expected to bring many positive signals to the market in the coming time when they have sufficiently "absorbed".
Specifically, the land segment in 2023 will welcome 22 projects with a supply of about 1,850 plots, down 73% compared to 2022, 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 ranging from 12.9 - 14.9 million VND/m2 and common areas from 70 - 90 m2. The land market in the surrounding areas continued to hold a dominant position, mainly concentrated in Binh Duong province, 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 early 2023. However, this decrease occurred locally in the group of customers using loans, as well as in some large-scale projects with incomplete infrastructure - legal.
The apartment segment recorded 126 primary projects for sale (about 22,071 units) in the year, down 32% compared to 2022, which is also the lowest level in the past 5 years. The supply for sale is mainly distributed in Ho Chi Minh City (concentrated in the East) and Binh Duong province.
Consumption reached about 9,664 units, equal to 44% of primary supply and down 56% compared to 2022. Primary consumption is concentrated in mid-range projects with prices ranging from 40 - 55 million VND/m2, with completed legal procedures, rapid construction progress, and convenient connections to the city center.
Primary selling prices have not fluctuated much compared to the beginning of the year, however, investors have promoted the application of many policies of quick payment discounts, principal and interest grace periods, etc. to stimulate market demand.
Meanwhile, secondary liquidity remains low, with secondary prices down about 3% - 8% compared to the end of 2022, mostly in projects that are in the process of completing legal procedures or are behind schedule in construction.
Residential real estate leads the market in 2024
Forecasting the market, VARS's research team believes that the real estate market in 2024 is expected to stabilize and is expected to welcome the return of about 30-40% of real estate brokers.
The residential real estate segment will lead the market from mid-2024 with a total supply of apartments estimated at over 30,000 products; of which, Hanoi has 15,000 products, Ho Chi Minh City has 5,000 products and Binh Duong province has about 10,000 products.
The residential real estate segment will lead the market from mid-2024 with the total supply of apartments estimated at over 30,000 products.
Besides, industrial real estate is still considered a good growth segment and continues to be a new production and business base for technology enterprises, especially in the high-tech sector.
Accordingly, FDI capital flows are still positive with the advantage of preferential tax policies. Traffic infrastructure is increasingly synchronized and modernized with a commitment to invest in infrastructure that is among the top in the region. Industrial park support services are increasingly improved.
Many new industrial park investment projects have been approved in principle and are starting to implement the next phases. The supply of industrial park real estate is witnessing growth in both the North and the South, the demand for industrial real estate is still very large, especially the demand for multi-purpose multi-storey warehouses and ready-built factories.
Demand is boosted in both quality and quantity with a series of investment plans and agreements from foreign enterprises, choosing Vietnam as a destination in the trend of transforming supply chains and expecting increased cooperation from active diplomatic activities, especially the recently upgraded Vietnam - US comprehensive strategic partnership.
The planning of many provinces and cities for the period 2021 - 2030 has been approved, which will partly resolve the problems related to legal procedures for industrial parks. These factors will help industrial park real estate in 2024 continue to maintain its position and continue to grow.
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