Real estate trading floor colluding “hugging goods”
House prices escalated due to lack of supply
CBRE Vietnam’s Hanoi real estate market report in the first quarter of 2022 said that there were about 3,500 apartments open for sale in the first quarter of the year, down 39% QoQ and 20% YoY.
Most of the new supply comes from the next phase of existing projects (6 projects), which are mainly Vinhomes’s 2 big projects, Vinhomes Smart City and Vinhomes Ocean Park.
There are some new projects being offered for the first time to the market such as Harmony Square in Nguyen Tuan or The Summit Buildings in Tran Duy Hung, but the quantity is limited, only a few hundred products.
New supply is scarce, while the rate of people looking to buy new homes is high, pushing apartment prices to continue to go up. A survey of asking prices through the Batdongsan.com.vn system showed that apartment prices increased by 10-15% in the first quarter of 2022, of which the mid-end segment (mainly new supply) was around. 40 million VND/m2 (excluding VAT and maintenance fee).
Due to not being able to find new projects for sale with suitable prices for their financial conditions, many people tend to look for old apartments (used for 3-5 years) on the secondary market. The prices of these products have also increased, averaging about 30 million VND/m2.
The fact that house prices are constantly escalating, in addition to the trend of upgrading the positioning of urban projects in recent years, according to a representative of CBRE Vietnam, it is also due to the scarce supply of new apartments in the inner city. if any, they are also concentrated in central areas such as Hoan Kiem, Ba Dinh, Dong Da… so the prices are very high.
In the same view, Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Realtors (VARS), said that the increase in selling price also comes from the reason that investment procedures take too long and the price of construction materials does not stop. The increase forces investors to push up prices accordingly to ensure profits.
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According to Mr. Dinh, if a commercial housing project is implemented smoothly in 3 years, the cost of business administration usually accounts for about 5% of the cost, but recently, this period has been extended by one and a half times or more. Double do the team up much cost.
Along with that, in the past 2 years, the price of construction materials skyrocketed, pushing up input costs. Data from the Vietnam Association of Construction Contractors (VACC) shows that, by the end of the first quarter of 2022, the price of construction steel has increased by 0.6-1.4 million VND/ton depending on type, equivalent to an increase of about approx. 40% compared to the beginning of the year, other materials such as sand and bricks also increased. At some points of sale of construction materials in Hanoi, the price of sand is at 300,000 VND/m3, an increase of 10,000 VND/m3 compared to the beginning of the year, brick and pipe increased by 100 VND/piece. Besides, domestic cement is also facing great pressure to increase prices when input fuels such as coal, petrol… increase in price.
“If now we build a cheap house, suitable for the pocket of the majority of people (under 25 million VND/m2 as now or less than 20 million VND/m2 as before), the investors will surely lose money. ”, emphasized Mr. Nguyen Quoc Hiep, President of VACC.
Not to mention, according to some investors, the cost of a project also includes “unnamed” costs and is often included in the contingency cost by commercial housing project investors. There have been many expectations for an early amendment of the Land Law and a series of other legal documents on real estate to remove the “forest” procedures for the implementation of new projects, but so far this important law continued to be delayed for the review period, making the project developers unable to help but have a different personality.
“The fact that many projects have not been resolved immediately, causing legal problems, causing investors to increase selling prices to improve profit margins as a long-term hoarding plan,” said a leader of a real estate business in Hanoi. To share.
The trading floor colluded to “embrace goods”
According to Vo Huynh Tuan Kiet, Director of Housing Marketing Department, CBRE Vietnam, after the turmoil caused by the recent epidemic, 2022 is considered a pivotal year for the next stage of economic development. Therefore, real estate prices will continue to increase and the growth rate depends on the absorption capacity and acceptance level of the market.
In fact, apartment prices continuously go up, while the income of the majority of urban workers cannot keep up with the rate of house price growth. Mr. Nguyen Manh Ha, Standing Vice Chairman of the Vietnam Real Estate Association (VNREA), assessed that the “out of phase” of supply and demand caused the real estate market to develop unbalanced.
Meanwhile, with the current situation, it is very difficult to pull down house prices, social housing is in small supply, and a series of projects are lying on the ground due to obstacles and bottlenecks in administrative procedures. The increase in house prices is expected to seriously affect the National Housing Development Strategy, with the goal that by 2025, the national housing area per capita will strive to reach about 27 m2 of floor space/person. , of which the housing area per capita in urban areas is 28 m2 of floor/person and in rural areas is 26 m2 of floor/person.
In another perspective, Dr. Le Xuan Nghia, a member of the National Monetary and Financial Policy Advisory Council, said that the high house prices are also partly due to the fact that many businesses collect a large amount of land to develop projects, but In fact, it is only “performed” for the purpose of “holding” land and waiting for the price to increase, while real developers lack land and serious projects.
“The consequence is that house prices increase continuously, increasing to heartbreak,” Mr. Nghia said.
Recently, the Ministry of Construction also pointed out the remaining problems. In particular, the operation of real estate exchanges has not yet ensured the good management of real estate transactions, prevention of money laundering in the real estate sector. The business of real estate brokerage services has not been well controlled. There is a phenomenon of real estate trading floors colluding with each other to “hug goods”, make prices, create waves, blow prices to cause virtual fever to eat the difference and disturb the market.
In some localities, there is still an abnormal situation of land use right auctions, high auctions and then depositing have negative impacts on the real estate market such as creating high land prices, increasing prices. real estate, neighboring houses compared to the actual market. This affects the investment calling environment and the recovery, compensation, and project implementation in localities.
at Blogtuan.info – Source: cafebiz.vn – Read the original article here
