Is the real estate market repeating the 2009-2010 scenario?

The real estate market seems to become “sensitive” to a flurry of information about infrastructure investment or the emergence of real estate projects. Typically, the land fever appeared in the areas along the 4th Ring such as Soc Son, Ha Dong, … (Hanoi). In Soc Son recorded a land plot increased 5 times in just 3 months. Some other areas such as Minh Phu and Bac Son communes (Soc Son) increased by 30%-100%. In suburban districts such as Quoc Oai and Thach That, there are areas where land prices have increased by 50% compared to 4-6 months ago.

Rising prices, virtual fever, low liquidity: Is the real estate market repeating the 2009-2010 scenario?  - Photo 1.

Soc Son real estate prices spiked when information about Ring Road 4 appeared.

Recently, the real estate market of Binh Phuoc also recorded a price fever when the news that this province proposed to build a bridge connecting Dong Nai. The price of land near DT 753 in Dong Phu and Binh Phuoc districts danced when the number of investors. investors and brokers poured in.

A representative of the government of Tan Loi commune, Dong Phu district shared with the press that the land price in the area along both sides of the DT753 road increased by more than 30% within 3 days.

Prices increased sharply, which is a bold movement recorded in the real estate market. The reason for the price increase is believed to come from the psychology of hoarding money in the land in the context of rising inflation. Expectations and fear of volatility pushed real estate prices up sharply. However, according to surveys and comments from real estate market research organizations, the number of transactions is low.

The signs of instability of the current market make some investors with many years of experience share that the scenario of 2009 is gradually appearing. That was the time when the market recorded unusually hot and cold.

According to Mr. Khoa, investors have witnessed the real estate cycle before, at the end of 2008, the real estate market recorded an increase in the prices of apartments and houses, but the number of successful transactions was not large. By early 2009, the market was warm and “hot” as prices rose sharply. By the end of 2009, mainly speculators bought and sold, causing the price to increase. After that, the market recorded slow liquidity.

In 2010, the real estate market continued to record strong capital inflows into real estate, massive construction projects. Real estate in Vietnam also recorded a dizzying increase in land prices, in some places by 30%, even in some places by 150-200%.

Mr. Khoa recounted, the price of 1m2 of land in Tu Lien ward, Tay Ho district (besides the Red River dyke) fluctuated from 50 to 60 million VND/m2 in 2010, while at the end of 2009 it was only 20 million VND/m2. Some inner city areas such as Thanh Xuan, Cau Giay, some places even shouted prices at 100-450 million VND/m2. Some houses in the deep alley are still offered for sale for over VND 50 million/m2.

According to Mr. Cao Minh Thanh, General Director of MLAND Pro, the real estate market is similar to 2009 in terms of prices. However, Mr. Thanh said that there would be no bubble burst and the risk of freezing as before because of the effective intervention of state management agencies.

Mr. Su Ngoc Khuong, Senior Director of Savills Vietnam admitted, when inflation occurs, although real estate prices increase, but the market cannot afford to buy, there is no liquidity. What worries Mr. Khuong is that many investors also use financial leverage to invest in real estate, making low-liquid assets a great burden for them as well as putting pressure on the banking system. row.

Mr. Khuong said that in the period 2011-2012, real estate prices in the whole market decreased by 30% because investors used too much financial leverage at that time. The rest, the reality shows that after each economic crisis, real estate prices increase.

Therefore, Mr. Khuong warned, in today’s complicated context, investors should carefully consider when using financial leverage, to avoid repeating the situation of “dead on assets” that has happened before. in the past.

The leader of Savills forecast that, in the next 9 to 12 months, it is possible for some investors to be forced to sell off assets because they cannot bear the pressure from financial support tools. However, the speculative nature of this group is not large, it is difficult to manipulate the market, affecting the price level. Besides, the supply of houses in Vietnam in the coming time is still very limited, so a reduction in real estate prices is very unlikely.

According to Trieu Vuong

Business & Marketing

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