Real estate prices “opposite” with supply, what bottlenecks need to be removed?
At the recent seminar, Mr. Nguyen Manh Khoi, Deputy Director of the Department of Housing and Market Management real estate (Ministry of Construction) said that the real estate sector is being interested by all levels of government and investors because the real estate market is a driver and promoter for the economy.
Two years (2020-2021) can be said that the real estate market is heavily affected by the epidemic when the number of projects decreases sharply. In 2021, the supply of apartments for sale and apartments will decrease by 34% compared to 2020, while in 2020 the number of new projects has decreased by 50% compared to 2019 by 50%. In 2 years, almost no new low-income housing and social housing projects have been licensed – one of the segments with high demand, low supply and high demand.
Regarding tourism and resort projects nationwide, in 2021, it will also decrease by 35% compared to 2020, and in 2020 will also decrease by 50% compared to 2019. Real estate prices are opposite to supply. Real estate prices continued to increase during the pandemic, especially in the land plot segment in the past 2 years. On average in the region and in a number of provinces, by the end of 2021, project prices will increase by 5-7%, individual house prices by 15-20%, land plots by 20-30%, and in some places by 50% in 20221. This phenomenon needs to be carefully discussed whether it is an objective or subjective cause, the cause of the price increase.
According to Mr. Khoi, the real estate market during the Covid-19 period poses many problems when the supply is decreasing, the demand is increasing, both domestically and abroad, house prices are also increasing.
There are some bottlenecks, first Although the Government and the National Assembly have issued policies and mechanisms to remove them, there are still bottlenecks such as: Lack of low-income housing supply, low supply and high demand.
Second Real estate prices are constantly increasing, especially in urban areas. Many people raise the question of land fever, but I would like to confirm that there is no real estate bubble, even though there is a fever, it is not a high fever. Real estate prices increased mainly due to low supply and high demand. Part of it is that the legal procedures have not been removed, there are 3-4 year projects, this situation happened when there was no Covid-19, leading to a backlog of projects. Financial sources are not diversified and sustainable, when bank credit is tight, stocks and bonds are controlled, this is being re-evaluated to see how long it will affect the market; The less the supply, the higher the price.
Currently, most localities have not done well with legal information about the project, causing many brokers to manipulate prices. However, it should be seen that a series of real estate policies designed for 2020-2021 have been delayed enough to be implemented in 2022; There are policies in early March of this year that local governments have just begun to implement.
Besides, many issues are being resolved in some decrees that are being implemented such as “issuance of red books” for Condotel will be clearly specified in the law. The immediate effect will remove investment and licensing, which is an opportunity for investors.
According to Mr. Khoi, in the coming time, the Government will amend and complete 3 laws at once, namely the Law on Land, the Law on Housing and the Law on Real Estate Business. The Government and ministries are very determined to perfect legal regulations to promote market development in the coming time. Amended laws are on the table of the National Assembly, waiting for the National Assembly’s approval.
Mr. Vo Hong Thang, Deputy Director of R&D DKRA Vietnam also said that the supply decreased a lot but the price increased. In the primary market, the land plot segment in the first quarter of 2022 saw an increase in selling prices in some localities such as Long An, up 4-6% compared to the previous quarter, Binh Duong up 3-5%… VND Nai has land plot projects of more than 74 million VND, approaching some localities in Ho Chi Minh City. The apartment segment is mainly concentrated in Ho Chi Minh City and Binh Duong, accounting for 85% of the whole market. The primary price level in Ho Chi Minh City increased from 3%-5%, Binh Duong increased from 2%-4%. Binh Duong market has apartments approaching 53 million VND/m2.
Another segment is the price of townhouses and villas increasing by 2%-3%. Dong Nai market recorded an increase of 8%-12%. During the pandemic, many investors offer policies to support cash flow for customers, support interest rates, etc. These costs cause price increases – but customers still benefit from this.
In particular, Dong Nai recorded projects up to 2.5 million USD/unit. For resort real estate, the primary price of condotel is 44-167 million, the whole South is 75 million. Condotel type in HCMC is 29% higher than in the North. Last quarter, primary prices increased by 5%-8% qoq.
The segment of townhouses and shophouses is strongly affected by Covid-19. With resort villas, the price ranges from 15-151 billion, the whole South is 26.6 billion and 25% higher than the North and 28% with the Central region. Shophouse resort townhouse, the average price is about 20 billion VND/unit, 18% higher than the North and 48% higher than the Central region.
According to Mr. Thang, the main reason for the increase in primary prices is that the land fund for the development of projects such as the inner city of Ho Chi Minh City is quite scarce, the legal bottlenecks are not removed much, the implementation time is long and affects In the past 2 years, supply has decreased sharply, input costs, material costs, and labor costs have all increased very high…
at Blogtuan.info – Source: Soha.vn – Read the original article here
