The market shows signs of 'heating up', apartment transactions retain the 'throne', the East of Ho Chi Minh City is 'boiling' with new projects

The market is growing positively, however there are signs of "heating up", apartment transactions are overwhelming; the supply of apartments in the East of Ho Chi Minh City is blooming... are the latest real estate news.

The Vietnamese real estate market in the third quarter in particular and the first 9 months of 2024 in general has shown a positive recovery after a difficult period. (Photo: Linh An)

Apartment transaction volume still "overwhelms" the market

According to the Vietnam real estate market report for the third quarter and the first 9 months of 2024 recently released by the Vietnam Association of Realtors (VARS), real estate segments, from housing, commercial to industrial real estate, all show signs of positive growth.

The Vietnamese real estate market in the third quarter and the first 9 months of 2024 in particular has shown a positive recovery after a difficult period, thanks to the stability of the economy and the Government's support policies. Presenting the real estate market report in the third quarter and the first 9 months of 2024, Ms. Pham Thi Mien, Deputy Director of VARs IRE, said that the residential real estate market has begun to show signs of "heating up".

The land auction story is “hotter” than ever with auctions held “overnight”, recording hundreds, even thousands of people accepting to “eat and wait” to compete for a spot. The winning price is also a record high, equal to land in a project with well-invested infrastructure.

The heat of the market is also led by the apartment segment, with prices continuously setting new high levels, in both the primary and secondary markets. The high demand has caused thousands of apartment owners to regularly receive calls asking to sell their houses. Despite the high selling prices, newly launched apartment projects have recorded very good absorption rates.

However, in addition to the results from actual supply and demand, the market has also shown signs of “heating up”. This situation is reflected in land speculation, pushing up housing prices and creating non-transparent real estate transactions. Many small investors participate in the market for the purpose of surfing, causing real estate prices to be unreasonably high.

Signs of “heating up” are also evident in the apartment segment, with the price of transferred apartments increasingly high, due to the “assistance” of some speculative groups. These signs all stem from the lack of supply, although it has improved.

Specifically, Ms. Mien said that in the third quarter of 2024, the residential real estate market continued to record a supply of 22,412 products offered on the market, with about 14,750 newly launched products, down 25% compared to the previous quarter, but up 60% compared to the same period in 2023.

In the first 9 months of 2024, the market recorded 38,797 new products offered for sale. Supply still recorded strong differentiation. Accordingly, 70% of new supply came from the apartment segment. Of which, products with prices of over 50 million VND/m2 or more dominated. The market was almost completely absent of affordable commercial apartments. In terms of region, the North led the new supply with 46%, followed by the Central region with 29% and the South with 25%.

VARS research data also shows that, although the supply is mainly in the high-end and luxury segments, the whole market recorded about 10,400 successful transactions in the third quarter, equivalent to an absorption rate of 51%. This reflects the market's interest in new real estate products, although most of the new supply is completed with high standards and investment costs, especially land-related costs, are increasing.

Transaction volume and absorption rate decreased by 25% and one percentage point respectively compared to the previous quarter but increased by 80% and 28 percentage points respectively compared to the same period in 2023. Of which, the volume of apartment transactions remained "overwhelming", accounting for 71% of total housing transactions in the third quarter, with new apartment projects recording an average absorption rate of 75%. Apartment projects in Hanoi even recorded an absorption rate of up to 90% shortly after opening for sale.

The trend of developing small apartments to reduce the overall value of the apartment, more suitable to the needs and financial capacity of singles and young families is increasingly evident. This is also the type of property with the best liquidity.

Ho Chi Minh City will issue land price list no later than October 20.

On the afternoon of October 14, the Ho Chi Minh City National Assembly Delegation had a working session with the City People's Committee on the socio-economic situation, the implementation of National Assembly resolutions and the contents registered for approval at the 8th session of the 15th National Assembly.

At the meeting, delegate Nguyen Tran Phuong Tran (Chairwoman of the Ho Chi Minh City Women's Union) raised the issue of when the city's land price list would be issued and said that voters were very interested in this issue.

In response, a representative of the Department of Natural Resources and Environment of Ho Chi Minh City said that the new land price list has been submitted to the City's Appraisal Council.

"This morning, the Council met and assigned the Department of Natural Resources and Environment to complete the submission and signing. It is expected that by October 20 at the latest, the land price list will be issued to serve the year 2025," said a representative of the Department of Natural Resources and Environment.

Previously, at the end of September, the Ho Chi Minh City People's Committee reported to the City People's Council the progress and content of the land price adjustment table. Accordingly, the Department of Natural Resources and Environment will complete the report to submit to the Council. It is expected that before October 10, the Council will meet to review. According to the plan, the adjusted land price table will be issued by the Ho Chi Minh City People's Committee before October 15.

During the time when the adjusted price list is not available, on September 21, the Ho Chi Minh City People's Committee approved departments, branches, Thu Duc City People's Committee and districts to apply the current land price list and land price adjustment coefficient to determine financial obligations and taxes.

District on the outskirts of Hanoi 'closes' land auction after 20 hours

On October 13, the Quoc Oai District Land Fund Development Center coordinated with National Auction Joint Stock Company No. 5 to organize an auction of 54 land plots at the auction land area in Son Trung village, Yen Son commune, Quoc Oai district, with a total area of ​​nearly 5,200 square meters.

The auctioned plots of land have an area of ​​92.5-121.4 m2, with a starting price of nearly 12.5 million VND/m2.

The auction had nearly 300 customers with more than 1,000 participating applications, equivalent to more than 5 customers interested in a plot of land.

The auction method is direct voting in multiple rounds, with a minimum of 5 mandatory rounds. The common price for each plot of land is 2 million VND/m2. The auction only ends when there are no more customers participating in bidding.

After nearly 20 hours and 12 rounds, by around 2am on October 14, 54 plots of land had been successfully auctioned with the highest price reaching nearly 55 million VND/m2, 4.4 times higher than the starting price. The lowest winning price was nearly 45 million VND/m2, 3.6 times higher than the starting price.

The total amount of money that Quoc Oai district collected from the auction was nearly 243 billion VND, a difference of nearly 180 billion VND from the starting price.

According to a survey on some real estate websites, the price of real estate in Yen Son commune for sale on the market ranges from 28-50 million/m2.

In the recent land market, although prices have increased in some areas, transactions have remained quite quiet. In some places, investors facing financial difficulties have reduced prices to cut losses, but transactions are still difficult.

Ho Chi Minh City apartment supply booms in the East

This November, the Ho Chi Minh City apartment market will see the King Crown Infinity project officially open for sale. Located on Vo Van Ngan Street (Binh Tho Ward, Thu Duc City), King Crown Infinity consists of two 30-storey towers Apollo and Artemis, providing the market with 729 apartments. Depending on location and area, the selling price of apartments at King Crown Infinity will be from 90 million VND/m2.

Another apartment project in Ho Chi Minh City that has officially launched new products in the last months of the year in the East of Ho Chi Minh City is Eaton Park by investor Gamuda Land. Located on Mai Chi Tho Street, Eaton Park provides the market with 2,000 luxury apartments. The price in the first phase is around VND 120 million/m2, equivalent to about VND 6-7 billion/1-bedroom apartment, VND 8-10 billion/2-bedroom apartment, VND 13-15 billion/3-bedroom apartment. After liquidating almost all of the two buildings A5 and A6, in the fourth quarter of 2024, Eaton Park will continue to launch the product basket of the two buildings A1, A2 including 550 apartments with an average price of VND 142 million/m2.

Also in the fourth quarter of 2024, the supply of apartments in Ho Chi Minh City in the East will be supplemented by The Opus One subdivision in Vinhomes Grand Park urban area. The Opus One subdivision is a combination of investor Vinhomes and Japanese partner SAMTY. It is known that the project consists of 4 towers, adding to the market 2,000 luxury apartments with prices starting from 80 million VND/m2.

The East will also welcome a new supply of Ho Chi Minh City apartments from the Fiato Uptown project in Tam Phu ward, Thu Duc city. Fiato Uptown consists of 4 apartment buildings located on a 1.6ha land area, with nearly 400 residential apartments and commercial service apartments. The selling price of apartments at Fiato Uptown is from 55 million VND/m2.

Real estate market data from Batdongsan.com.vn shows that apartment prices in Ho Chi Minh City have been increasing continuously over the years. From 2015 to 2023, the price increase index of Ho Chi Minh City apartments has exceeded the growth rate of people's income. From 2015 to 2023, after 8 years, apartment prices in Ho Chi Minh City increased by 56%, while the income of people in urban areas increased by only 39%.

According to a report by Cushman & Wakefield, over the past 10 years, the average price of apartments in Ho Chi Minh City has increased by about 12% per year. In the primary market, the average selling price of apartments in Ho Chi Minh City is over 60 million VND/m2. In the secondary market, the average apartment price is 45 million VND/m2.

In the third quarter of 2024 alone, according to data from Batdongsan.com.vn, compared to the same period last year, Ho Chi Minh City apartments were the brightest spot in the market. This is the type of property with the strongest growth in interest, reaching 19% compared to the same period last year.

Apartments are also the type of property with the strongest increase in selling price compared to the same period last year, reaching 12%. Notably, despite the high prices, some projects still have quite good liquidity in the market, especially in projects with full legal documents and from large, reputable investors. The liquidity rate of projects reaches over 60% in each launch.

Commenting on this reality, Mr. Dinh Minh Tuan, Director of Batdongsan.com.vn in the Southern region, said that in reality, future supply is quite limited due to the scarcity of clean land. Legal bottlenecks are still in the process of being resolved, making it difficult for investors to implement new projects. In addition, great financial pressure makes many investors lack capital to implement projects.

In addition, the new point in the 2024 Land Law on adjusting the new land price list will affect the input costs of enterprises and the selling price for customers, leading to an upward trend in future selling prices. Apartments still account for a high proportion of demand for long-term investment and real-estate. Therefore, apartments will still have good absorption in the market and selling prices will continue to trend upward.

Source: https://baoquocte.vn/bat-dong-san-moi-nhat-thi-truong-co-dau-hieu-tao-nhet-giao-dich-chung-cu-giu-ngoi-vuong-phia-dong-tphcm-suc-soi-du-an-moi-290130.html