The situation of “earnings on paper”, the risk of real estate bubbles
In the first quarter of this year, the demand for price search of most real estate segments increased, especially land plots increased by 3-5 times compared to the previous time, information from Batdongsan.com.vn.
However, in some places, “profit on paper” appeared, ie the asking price increased, but it was difficult to find buyers. The price increase is not true to the true value and potential real estate bubble.
Along with the information to the city, recently 3 districts of Binh Chanh, Hoc Mon and Cu Chi continuously attract capital flows from the big guys. real estate poured in, causing land prices in these markets to increase.
Land asking price increased, but it was difficult to find buyers. (Illustration image – Photo: Investment Newspaper)
For example, a plot of land in this project in Binh Chanh district, from January 1, costs 13 billion VND for 100 m2.2, is now pushed to 17 billion and shows no sign of stopping. Surveyed on real estate forums, the land market in Binh Chanh district also increased from 30% before the administrative upgrade information.
“The new area in there is now a million-dollar villa, equivalent to 120 million VND/m2, 2 times higher than 2 years ago. Trading is not yet because the population is still low, here are mainly construction works”, said Mr. Luong Ngoc Lan, Binh Chanh district, Ho Chi Minh City.
However, the paradox is that the asking price of real estate is high, but it is not easy to sell, because many residential areas are still deserted and services have not kept up. There are places where the price increase is not true to the true value.
“For the subdivision area with no real transactions for those who have real needs, we see absolutely no liquidity and it is investors who buy and sell around each other, investors must using big financial leverage such as having to borrow from a bank or take a hot loan from the society to invest, especially, investors can end up with huge consequences, even losing their assets, capital and losses. seriously,” said Chairman of the Ho Chi Minh City Real Estate Association Le Hoang Chau.
According to DKRA’s first quarter report of 2022, including Ho Chi Minh City and neighboring provinces, less than 2,600 apartments were sold in the first three months of the year. The situation of rising land prices is putting pressure on people looking to buy real estate to live in, because it is very difficult to find products that are suitable for their budget.
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