Blowing prices creates a fever, land prices increase “dizzy”

Land has the highest price increase

As noted by CBRE, from the end of 2021 to the beginning of 2022, land prices increased as well as land fever occurred on a large scale compared to the previous time.

Typically, in the vicinity of Ho Chi Minh City, such as Binh Duong and Dong Nai, land fever has occurred. Then it spread to Binh Phuoc, Tay Ninh and the western region such as Duc Hoa and Ben Luc of Long An.

At present, in the areas of Phan Thiet, La Gi, Ham Thuan Nam, Ham Thuan Bac of Binh Thuan, there have been local fevers.

Farther from the Central Highlands, plateaus such as Bao Loc, Lam Dong and now Dak Lak and Buon Ma Thuot also happen. In the North and Central regions, land fever also appeared.

According to a report by Vietnam Report, the cause of land fever is that currently, information about planning and infrastructure is still heavily speculative, and the blowing of real estate prices by unfair methods has not yet been regulated. sanction.

However, land fever is not only due to the above reasons, it can be the result of macro policies, official master plans from the government…

In 2021, the price of construction materials, especially steel and cement, increases sharply, causing house prices to increase by about 10-15% compared to 2020. In addition, barriers from legal factors , the imbalance of supply – demand and the results of some land auctions have caused the price level to be continuously pushed up.

However, many experts are also concerned that if inflation exceeds the target level, the increase in lending interest rates may have the opposite effect, the real estate market may fall into a quiet state but the price level will not drop sharply. As in the 2011-2013 period, due to the smoother and more stable regulation of the Government, real estate businesses as well as homebuyers will face many difficulties and risks when the proportion of loans for real estate investment is pretty big.

According to Vietnam Report, Vietnam’s real estate market in 2022 will have brighter and more positive colors than 2021, and will gradually return to the pre-epidemic trajectory (in 2019).

Many experts and businesses believe that the growth trend is in most segments, in which the industrial real estate, land plots and housing segments are likely to have the strongest growth. Besides, the recovery of resort and commercial real estate group.

Blowing prices creates a fever, land prices increase rapidly - Photo 1.

In 2022, land plots are the segment with the highest potential for price appreciation.

Regarding the average price fluctuation in 2022, it shows that land plots are the segment with the highest potential for price appreciation; The segment of land plots, agricultural land, low-cost housing and apartments is likely to increase in price in the range of 11-20%. The segments of suburban real estate, industrial real estate, housing and mid-range apartments, and offices for rent can increase by 5-10% on average compared to the previous year.

Growth thrust

The growth of the real estate industry in the near future is mainly due to companies restructuring their operations and recovering from the negative impact of the pandemic, along with the support of stimulus packages. According to the Government’s economic incentives, interest rates are still low, public investment is accelerated, disbursement of foreign investment capital continues to flow strongly into Vietnam, remittance flows continue to operate in a stable manner. determined (except from Russia and Ukraine) and many policy bottlenecks were removed.

In the short term, the Government’s economic stimulus package, no matter which area is poured into, will bring positive effects to the real estate market, thanks to the improvement of people’s purchasing power in general, even an increase in After a long time of being suppressed, as well as improving their future income expectations, helping the retail real estate market, industrial parks will benefit significantly, according to Vietnam Report.

“The economic support package of VND 350,000 billion is about to be implemented, of which nearly VND 114,000 billion is for the infrastructure sector, which will have a direct impact on the real estate market not only in the short term but also as a driving force. the main growth of the market in the coming years”, Vietnam Report forecast.

The growth engine for the real estate industry in general, not only in the post-Covid period, is also affected by the trend of urbanization and the growth of the middle class in both quantity and value of properties, the amount of The rapid increase in personal cars will also greatly affect the demand for some segments of high-end apartments, resort real estate and land plots.

According to Knight Frank’s report, it is forecasted that in the next 5 years, the growth of the number of super-rich people in Vietnam will be 26%, equivalent to Hong Kong and Taiwan. This is the basis for many investors to continue pursuing the high-end and luxury segment in the coming time.

In addition to the supportive push, many businesses are concerned that the real estate industry will face many challenges and obstacles when the disease control of countries around the world and Vietnam as well as the speed of economic recovery still face difficulties. facing many difficulties in the context of inflation pressure, the number of new Covid-19 cases is still increasing along with the general instability in geopolitics, the supply in the market has not improved much due to legal problems. has not been completely removed.

According to Phong Linh

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