Strange phenomenon of the real estate market

Strange phenomenon of real estate

In the context of serious shortage of supply, the secondary apartment market in Hanoi attracts buyers, so it is very active. In new projects put into use, with beautiful and convenient locations, house prices on the secondary market are increasing rapidly.

For example, at an apartment project located on Dinh Cong street (Hoang Mai district), although it was only opened for sale at the beginning of this year, it was sold out in less than a month. The selling price offered by the investor is 38 – 42 million VND/m2, depending on the location.

Because it has been sold out, in case customers want to buy apartments in this project, they have to buy and transfer from the old owner (buy on the secondary market). On the secondary market, the selling price of apartments in this project has increased to 40-43 million VND/m2.

Similarly, at an apartment project located right on Quang Trung street (Ha Dong district), in early 2021, customers buying apartments will have to pay VND 29 – 31 million/m2. However, currently, the secondary price in this project has increased to 34-35 million VND/m2.

Mr. Vu Tung, a real estate broker in Hanoi, said that because the apartment market is scarce, the secondary price is higher than the primary price, which is the rule of the real estate market. Even the projects that have been put into use for a long time are on the verge of increasing prices.

However, some projects go against this rule, the primary selling price is much higher than the secondary selling price.

For example, a 45m2 apartment in a project in Nam Tu Liem district, expected to receive a house in May 2023, is currently priced at VND 1.9 billion, equivalent to VND 42.3 million/m2. Meanwhile, on the secondary market, customers can easily find and buy from the old owner, with the price of only 1.5 – 1.6 billion VND, equivalent to 33-35 million VND/m2.

Especially, the apartments for sale on the secondary market for a few hundred million dong cheaper are new, unused, and even have not been handed over to customers.

A real estate broker at this project said that because the investor has a policy of changing the selling price every 3 months, the primary price is much higher than the secondary price.

“Since this is a large project, in addition to building housing areas, the investor also develops other utilities. Therefore, there is a policy to change the selling price every 3 months. This change in selling price also benefits early buyers, even if reselling, lower than the primary price, it is still profitable,” the broker said.

Need to build price index

However, the continuous price increase has caused the average land price to increase rapidly, creating great pressure for those who want to buy real houses.

Commenting on this issue, Mr. Nguyen Van Dinh – Vice Chairman of the Vietnam Real Estate Brokers Association said: “This phenomenon is most likely a trick of the real estate sales industry. Then in Hanoi, the source of goods is scarce, investors take advantage of the situation of high demand and low supply to raise prices and sell products through distribution units.

This situation appears to bring no benefits to buyers, but only creates chaos for the market and information becomes “chaotic”, Mr. Dinh said. That is, there are many selling prices in the market such as ceiling prices, production prices, price differences, etc., thereby creating an unprofessional and transparent market.

Sharing the same opinion with real estate expert Nguyen Van Dinh, Assoc. Prof. Dr. Dinh Trong Thinh – an economic expert affirmed that this is just a “price blow” trick of the investor to maximize profits.

“The primary selling price is many times higher than the secondary price, how do buyers and sellers “eat the difference”. Obviously, this is a very strange and unreasonable case compared to the rules of the market. real estate,” said Mr. Thinh.

Also according to Assoc. Prof. Dr. Dinh Trong Thinh, in this case, both real home buyers and investors suffer. Only investors can benefit from rising housing prices.

In order for this phenomenon not to continue, real estate experts said that it is necessary to be transparent in the selling prices of apartments on the market. Especially the state and management agencies should soon develop and issue a price index so that investors and customers have a basis to compare and contrast in the case of buying and selling goods on the market. avoid the biggest risk to the buyer.

According to Economic Life