Fluctuating Real Estate Market: Great Opportunities but Risks Are Near

Currently, land prices in many areas of the province, especially in Thai Nguyen City, are skyrocketing. Along with that, inflationary pressure, gold prices continuously reaching new peaks, and idle money "looking for safe havens" make land an attractive investment channel. However, behind the "fever" are many potential risks when speculation, price inflation, and "virtual fever" begin to appear.

Many people come to buy land in Thai Nguyen city.

Investors rush to "hunt for goods"

According to the reporter of Thai Nguyen Newspaper, since the Lunar New Year until now, the real estate market in the province has been "heating up" day by day. Many areas in Thai Nguyen City such as Thang Long Urban Area, Danko City, residential area No. 1 near GO! Commercial Center... have become the focus of the "wave" of price increases. In just over a month, many plots of land here have increased in price by 4-5 times. Specifically, a plot of land with a lake view in Thang Long Urban Area is currently being offered for sale at over 42 million VND/m², an increase of more than 5 million VND/m² compared to before Tet.

Representatives of some large real estate companies and transaction offices in Thai Nguyen such as Minh Tan land, Hong Phat land, Construction and Architecture Real Estate Joint Stock Company... affirmed: The number of transactions has skyrocketed, especially in the land, townhouse and apartment segments.

Mr. Le Duc Quyet, Le Quyet Land Real Estate Transaction Office, said: The number of customers looking to buy land has increased dramatically, mainly customers looking to buy houses and land with clear planning and full legal documents. They are hunting for plots of land with beautiful locations and full amenities to anticipate the information about the province's merger.

Not only the central area, the suburbs such as Quyet Thang and Phuc Xuan communes also became “hot spots” when the 6-star international resort project was started. Small and medium-sized plots of land, priced under 1.5 billion VND, were quickly sought after by small investors.

Ms. Nguyen Minh Tam, Tan Lap Ward, Thai Nguyen City, shared: I have been looking at land for the past few weeks but the price has been increasing continuously, yesterday it was 1.2 billion, the next day it was 1.4 billion. I am really worried because I am afraid that if I don't buy, I will miss the opportunity, but if I buy, I am worried that the price will be inflated.

A representative of the Thai Nguyen City Tax Department informed: In the first two months of this year alone, we have received nearly 2,500 land use rights transfer dossiers. The amount of tax collected from transactions has also increased by more than 30% compared to the same period last year.

Land prices in Danko Urban Area (Thai Nguyen City) are "heating up" again.

Many factors combine to push up land prices

Experts say that the recent increase in real estate prices in Thai Nguyen City is not simply due to the news of the province merging, but is also the result of many factors.

Although there has been no official decision on the merger with any locality, the fact that Thai Nguyen was chosen as the headquarters of the State Bank of Region V, the Tax Department of Region VII and the State Treasury of Region VII has immediately become a "catalyst" for the real estate market to be vibrant.

The psychological expectation of a new administrative and economic center formed after the merger is causing a strong flow of money into the land market. The history of previous mergers shows that areas chosen as administrative centers often record a land price increase of 30-50% in a short period of time.

At the same time, the context of rising inflation and gold prices continuously reaching new peaks has urged many investors to switch to real estate. Many people do not hide their views that buying land at this time is both an opportunity to anticipate planning and a way to preserve capital flows in the face of unpredictable fluctuations in the economy.

In addition, major policy changes with the Land Law, Real Estate Business Law and the revised Housing Law officially taking effect from mid-2024 have also created a new wave in the market. Simplified procedures and tightened legality help buyers feel more secure when spending money, further increasing demand in the market.

People in Phuc Xuan commune (Thai Nguyen city) leveled land to sell before the news that many investors were looking to buy land in the suburbs.

Warning of the risk of "virtual fever"

Although the market is very vibrant, many experts are concerned about the risk of "virtual fever" and a real estate "bubble" forming clearly in Thai Nguyen. Taking advantage of the FOMO (fear of missing out) mentality, brokers and "land brokers" are spreading false rumors, pushing land prices up rapidly, far beyond their real value.

Faced with complex developments, real estate experts warn investors to be extremely alert and not to follow the crowd or unverified information. Choosing areas with clear planning, full legal status and real development potential is a vital factor to limit risks.

Mr. Pham Duc Thuan, Head of the Representative Office of the Vietnam Association of Realtors (VARS) in Thai Nguyen, commented: Land fevers of this type often develop quickly, with virtual price increases due to psychological pressure and rumors. If not well controlled, it is easy for small investors to buy when prices are inflated, then get 'stuck' when the market cools down.

Mr. Thuan also recommended that investors need to calculate carefully and limit the use of large financial leverage in the context of many unpredictable market fluctuations.

According to experts, the Thai Nguyen real estate market will continue to fluctuate strongly in the coming time. Therefore, only investors who understand the market, have a medium- and long-term strategy and sufficient financial resources can optimize profits from this potential but also risky "game".

Source: https://baothainguyen.vn/thoi-su-thai-nguyen/202503/thi-truong-bat-dong-san-bien-dongco-hoi-lon-nhung-rui-ro-can-ke-2c204fb/