Real estate skyrocketed, abandoned houses still “burned hands”

Prices continue to increase “galloping”

Mr. Nguyen Hung – an investor in Hanoi took advantage of the adjoining viewing area in the West of Hanoi, with the desire to own to rent out to make a profit. However, because prices in many projects increased sharply, his search failed.

“I panicked when I heard the price of the adjacent villa at the moment. Many apartments from the end of last year to now have increased to several billion dong. My plan is being shelved because the price of villas and adjacent houses is constantly increasing at a dizzying speed and the volatility is very large,” said Hung.

In fact, right next to Tet, the demand for buying this segment is very large even though the growth rate of this segment has been very high recently. However, in fact, when the market was pushed, many investors also trembled and did not dare to swing to the top.

Savills’ report on the villa and adjoining Hanoi market in the first quarter of 2022 shows that the new supply increased sharply to 801 units, up 227% QoQ but still down 15% YoY.

Primary supply reached 1,513 units, up 35% QoQ but down 24% YoY, evenly distributed across the city. The east of Hanoi (Gia Lam district) accounts for 25%, while the west including Hoai Duc district and Ha Dong district also has 25% of primary supply. Hoang Mai district in the south accounts for 22%, while districts in the north including Tay Ho, Bac Tu Liem and Dong Anh have a total market share of 28%.

In terms of liquidity, transaction volume improved with 666 units sold, up 62% QoQ but down 29% YoY. Hoai Duc district recorded the highest volume of transactions with 33% market share, followed by Bac Tu Liem district with 23%.

Townhouses and townhouses account for 82% of transactions. Absorption rate reached 44%, up 7 percentage points QoQ but down 3 percentage points YoY. The absorption rate for new supply reached 59%.

Do Thu Hang – Senior Director, Hanoi Research and Consulting Division of Savills, said that the average primary selling price of the villa reached 134 million VND/m2 of land, down 26% quarter-on-quarter, but up 30 percent. % By year. The average price of townhouses is 185 million VND/m2 of land, up 8% QoQ and 73% YoY. With townhouses, the average price is about 323 million VND/m2 of land, up 35% QoQ and 79% YoY.

The next stage has a significantly higher selling price compared to the previous stages. Townhouse prices of the later period in Hoang Mai district recorded an increase of 56% quarter-on-quarter while Hoai Duc district recorded an increase of 42% quarter-on-quarter for townhouses and 26% quarter-on-quarter for townhouses in subsequent periods. .

According to Savills, since the third quarter of 2021, the primary selling price has continuously recorded the highest price ever. The fourth quarter of 2021 recorded the highest average selling price at VND 381 million/m2 of land in Tay Ho district. However, this price was surpassed in the first quarter of 2022 with 417 million VND/m2 of land coming from townhouses in Hoang Mai district.

Explaining the price increase of adjacent villas, Ms. Hang said that the segment of villas and townhouses may still be of great interest this year. However, as mentioned above, many reports show that the segment of adjacent villas in Hanoi last year increased very strongly, in some places doubling after 2 years.

According to Ms. Hang, it is necessary to have a realistic assessment of what product it is because if the project increases too much, the liquidity will decrease.

Real estate experts said that recently, real estate prices have been pushed up. Recorded in many segments, including the villa segment, adjacent to the phenomenon of large demand, scarce goods, and a sharp increase in prices have created an opportunity for a speculator to participate in the development of the market, so investors need to be alert to the “bullshit” of the market.

Abandoned houses also increased

In Van Canh urban area (Hoai Duc district), although a series of villas and townhouses are still deserted and uninhabited. However, just in the last 2 years, the price in this urban area has doubled. Notably, from the beginning of 2022 to now, the price has increased from about 10-20%.

Mr. Tran Vinh – broker in Hoai Duc area (Hanoi) said, 2 years ago the price in Van Canh urban area fluctuated about 40 – 65 million VND/m2. Up to now, the price in this urban area has increased more than 2 times, specifically, for apartments located on the road surface of 17.5m, the price ranges from 65 – 110 million VND/m2. As for the villas and adjacent houses located on the 30m road surface, the price is from 110 to 150 million VND/m2.

For example, a semi-detached house with an area of ​​113.8 m2 located on a 17-meter street, at the beginning of 2020 priced at about 43 million VND/m2, now the price of this adjacent house has reached 130 million VND/m2, equivalent nearly 15 billion VND.

Another 260 m2 villa, located on a 17-meter road, priced at 75 million VND/m2 in 2020, is now for sale for more than 130 million VND/m2, equivalent to nearly 34 billion VND.

Explaining the sudden increase in prices, Vinh said that information from Hoai Duc district to the district made the price change rapidly. Besides, in recent years, strong infrastructure construction has been deployed in this area such as the 3.5 ring road connecting the North Tu Liem, Nam Tu Liem, Hoai Duc, Ha Dong, and Thanh Tri areas and the project. extending Tran Huu Duc street with Pham Hung, making the connection between Van Canh urban area and the central area shortened in time and distance.

However, despite benefiting from infrastructure and rising prices, this urban area is still littered with villas, abandoned townhouses, and moss growing around.

Similarly, in Ha Dong district (Hanoi), the fever in the West of Hanoi in recent years has led to an increase in the prices of adjacent houses and villas in this area. Quang Anh, head of the real estate transaction office in Ha Dong, said that in Duong Noi urban area, from 2018 to now, the average annual growth rate has increased by 20-30%.

Specifically, in 2020, the price of villas and townhouses on the 17-meter road will cost about 70-90 million VND/m2, while the 11.5m-wide road surface will cost about 50-60 million VND/m2. However, up to now, the price of apartments on 17m street is from 140 to 160 million VND/m2, on 11.5m street the price ranges from 100 to 120 million VND/m2.

Despite the continuous increase in prices, in fact, in many projects, there are still many adjacent houses and villas in the state that the rough construction has been completed, but there are no people to grow grass for a long time. Besides, many beach houses for rent at low prices. Therefore, investors need to be wary of virtual prices being pushed up.

Mr. Matthew Powell, Director, Savills Hanoi issued a warning, with increasing price pressure and high inflation rate while credit is tightened, it will likely slow down the real estate market in the short term. .

According to Economic Life