Townhouses and villas in the market in Ho Chi Minh City and surrounding areas have experienced a sharp decrease in supply

DKRA Vietnam’s first quarter market report shows that new supply townhouse/villas in Ho Chi Minh City and neighboring provinces decreased sharply.

In the first 3 months of the year, the market had 611 units for sale from 12 projects, only 17% compared to the previous quarter and 31% compared to the same period last year. The consumption rate reached 71%, equivalent to 432 units, equal to 18% compared to the fourth quarter of 2021 and equal to 65% over the same period last year.

Supply and consumption are mainly concentrated in Ho Chi Minh City, accounting for 60% of the new supply in the whole market. The primary price level increased by 3-5% due to the increase in input costs. Dong Nai alone recorded an increase of 8-12% in the primary selling price compared to the previous quarter.

Specifically, the highest primary selling price in Ho Chi Minh City is 150 billion VND/unit, the lowest is 5.5 billion VND/unit. Next, in Dong Nai, the highest primary selling price was 85 billion VND/unit, the lowest was 5 billion VND.

Next, Ba Ria – Vung Tau has the highest primary selling price of 21.3 billion VND/unit, the lowest is 4.6 billion VND/unit/. Particularly in Long An market, the primary selling price is the most comfortable when the highest price is 13 billion VND/unit, the lowest is 2 billion VND/unit.

According to DKRA, the liquidity of the secondary market is at an average level, focusing mainly on projects in Ho Chi Minh City that have been handed over to houses, convenient transport infrastructure and have a selling price of less than 10 billion VND/ apartment. For neighboring provinces, no secondary transactions have been recorded.

Products located in large-scale urban areas, with many utilities, synchronously and methodically planned and developed by large and reputable investors continue to attract the attention of the market.

A row of “sluggish” commercial townhouses is located in Cat Lai port area, City. Thu Duc.

As for the townhouse/villa market in Ho Chi Minh City, according to statistics in Q1/2022, the HCMC market. Ho Chi Minh City received 368 units for sale from 9 projects (including 7 new projects and 2 projects in the next phase), 2.3 times higher than the previous quarter and up 6.4% over the same period last year.

The ratio of consumption to new supply is approximately 70%, equivalent to 256 units, 4.5 times higher than the fourth quarter of 2021 and up nearly 30% over the same period last year.

The East is still the leading area in terms of supply and consumption, but the proportion is gradually decreasing. The market tends to move to the North and West, areas with large land bank and low selling prices compared to other areas.

The number of projects put on the market is increasing, but mainly small-scale projects with a limited number of apartments. The primary selling price increased by 3-5% compared to the pre-sale period. However, many preferential policies, discounts, interest rate support … are applied by investors to support buyers.

Secondary transactions are at an average level, focusing mainly on projects that have handed over houses with the selling price of about 10 billion VND/unit. Large-scale projects, diverse internal utilities and convenient connection locations have high transaction success rates.

“New supply and demand in the townhouse/villa segment in Ho Chi Minh City and surrounding areas may increase compared to the first quarter. Supply fluctuates around 1,900 units, concentrated in a few localities such as HCMC and Dong. Deer.

Tay Ninh continues to be short of new supply. Particularly in Ho Chi Minh City, the East area is still leading in terms of supply and consumption of the whole market. The primary price level is likely to continue its uptrend due to increased input costs,” said DKRA expert.

According to research, over the past 5 years, luxury commercial townhouses have begun to appear in large-scale urban projects in Ho Chi Minh City, divided into 2 product groups. The first is a commercial townhouse, attached to the land, long-term ownership. The second is townhouses attached to the base blocks of buildings, owned for a period of time, mainly 50 years.

Particularly, commercial townhouses attached to land are a type of real estate built by many investors in a residential project. The feature of this type is that it is located on the main road, designed from 4-5 floors, of which the 1st floor is used for business, from the 2nd to 5th floor is used for living.

This segment attracts very well the cash flow of investors. With the advantage of both living and doing business, shophouse quickly became a sought-after product by many investors. Therefore, the selling price of the investor is already high, the secondary price has also increased significantly.

However, despite the high price, this product line is still in the form of buying and leaving. It is not in urban areas or high-rise buildings that this type also attracts tenants or residents. In Ho Chi Minh City, there are many areas that, despite having handed over products for a long time, have remained vacant for many years and fell into a state of stagnation.