Residential real estate "heats up"
In particular, the 2023 Housing Law, the 2023 Real Estate Business Law and the 2024 Land Law officially taking effect from August 1, 2024, 5 months earlier than the previous regulations, have contributed to completing the legal corridor for the real estate market and opening a new cycle for the market in a safer, healthier and more sustainable direction. Real estate segments, from housing, commercial to industrial real estate, all show signs of positive growth with many new projects being implemented.
The residential real estate market has begun to show signs of "heating up".
Presenting the Real Estate Market Report for 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".
Accordingly, 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 project land 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.
Along with the apartment type, some newly launched low-rise projects of major investors also recorded a "record" number of bookings despite the increasing prices. Many apartments have good locations, not only high prices, but to buy them, customers/investors also have to accept paying the difference.
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 the emergence of 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 shown in the apartment segment with the increasingly high asking price of transferred apartments, due to the "assistance" of some speculative groups.
These signs all stem from a 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 devoid 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 to 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.
Apartment transactions remained "overwhelming", accounting for 71% of total housing transactions in the third quarter.
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 that records the best liquidity.
High anchor price pushes up demand "shifting"
In the first 9 months of 2024, the market recorded 30,589 successful transactions, 2.5 times higher than the same period in 2023. Many new projects launched at the end of September, starting to receive bookings, also recorded a large amount of interest and deposits.
In terms of selling prices, housing prices continue to be “anchored” at high levels, in both the primary and secondary markets, especially in the apartment segment. The imbalance between supply and demand is becoming increasingly serious as supply, although improved, is still difficult to meet demand. In addition, most of the new supply continues to be completed at high standards with investment costs, especially costs related to land, increasing.
Housing prices continue to remain high in the Hanoi market.
Specifically, in the third quarter, the primary price level in Hanoi continued to increase and showed no signs of stopping, while supply has been gradually improving. New projects, from low-rise to high-rise products, mainly in the high-end and luxury segments, still received strong attention from the market. This has created a driving force leading to the secondary apartment price level remaining high, although liquidity has gradually stabilized after a period of "hot" growth.
Demand for real estate, including housing and investment, continues to shift to suburban areas, provinces and cities surrounding the two special urban areas and the secondary market with many options at more reasonable prices. Apartments and houses under 3 billion VND are being "hunted" strongly in Hanoi and Ho Chi Minh City.
Le Trang
Source: https://www.congluan.vn/vars-thi-truong-gan-nhu-vang-bong-hoan-toan-can-ho-chung-cu-thuong-mai-gia-binh-dan-post316639.html
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