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Which real estate segment should I invest in in Ho Chi Minh City?

Experts say that this is the time when the market is losing liquidity, so unless there is a real need, people should only invest in the long term.

Sharing with Zing, Mr. Le Quoc Kien, a real estate consultant, called the current time the “recession tide” phase of the market, when the investment wave has passed and the liquidity is low.

Vo Huynh Tuan Kiet – Director, Head of Housing Marketing at CBRE Vietnam – acknowledged that the new supply currently focuses only on the high-end and luxury segments, while the transaction speed in the secondary market is limited. level is not really as high as before. Therefore, the trend of surfing and short-term investment is no longer relevant.

Safe investment or get rich quick?

According to Mr. Vo Huynh Tuan Kiet, this is the ideal time to buy a house to live in because prices will tend to increase in the near future. However, instead of choosing new products for sale that are anchored at high prices, people should look to the secondary market with more options.

As for investors, he believes that depending on financial advantages, there will be an appropriate plan. A group of customers with high finance who can make long-term investments should think about real estate in the central area of ​​Ho Chi Minh City and high-class and luxury products.

What is the list of areas where you live in Ho Chi Minh City? 1

Luxury real estate in the city center is said to be the optimal investment choice at the moment. Photo: Quynh Danh.

“The villa, townhouse and shophouse segment is in very little supply, the primary price is increasing very quickly, about 45-75% per year and in the coming time, it may increase even higher because more and more investors want developing super high-end products, and apartments in the central area, although the price growth rate is not as high, averaging only 4-7% per year, but it has high safety and assurance”, Mr. Kiet analyzed. .

Meanwhile, the suburbs of Ho Chi Minh City have many products for mid-range investment or buy to live in, while neighboring provinces such as Dong Nai have high potential for price appreciation thanks to Long Thanh International Airport under construction, or Binh Duong is an alternative market for the mid-range segment, including apartments or villas, townhouses, shophouses thanks to urban infrastructure and good connectivity.

Sharing this view, Mr. Le Quoc Kien emphasized that the safe investment plan will “take the throne” from now until the end of 2023. This option needs products with good liquidity, which means clear legality and availability. can be used immediately as living or business exploitation. These properties must be located in a place with a relatively stable population density and minimal basic amenities such as commercial roads, markets, schools, medical centers, amusement parks, etc.

“Especially, the product is loaned by banks with more than 70% of the market price. Normally, banks charge 80-90% of the market price and lend 70-90% of this valuation, so for example, finance product 6 billion dong valued 5.2 billion dong and lend on 4.2 billion VND is a good asset,” added Mr. Kien.

“The get-rich-quick scheme is only suitable for those who deduct 20-30% of their idle assets and accept not to touch this money for at least 3-5 years,” said Le Quoc Kien, a real estate consultant. produce.

However, he believes that investors with idle money and strong cash flow, who are not under pressure of bank leverage, can still consider the get-rich-quick scheme, multiplying assets x times in the medium and long term by unfinished legal real estate (future formation) or large land in the province, coastal areas…

“Of course, this choice will come with risks such as project failure, failure to finish, poor liquidity, long-term capital loss, change in State management policy or adjustment of land use planning. The project is only suitable for those who deduct 20-30% of their idle assets and accept not to touch this money for at least 3-5 years,” he shared.

Sustainable investment path

Witnessing many acquaintances who boast of buying cheap provincial land while much higher than the actual local transaction price, or suffering heavy losses due to inappropriate profit expectations, Mr. Kiet emphasized the most important thing is to identify Setting goals, time and expectations when investing, thereby understanding the market and products, and avoiding trending investments.

With the current state of liquidity and management measures by State agencies, he also recommends that investors limit the use of financial leverage and choose products that are suitable for their capacity.

More specifically, Mr. Le Quoc Kien believes that sustainable real estate investment will need to be done in parallel with production and business or doing good work. At that time, investors use the surplus from business profits or unused income to put into real estate, to ensure that the investment is stable whether the market heats up or freezes.

“In the past three crazy years, there have been three dangerous cases. First, venture capitalists borrow excess money to use loans to pay back to the bank. Second, income drops unexpectedly, causing investors to lose money. Not enough cash flow to pay the bank every month.

Third, investors who use production and business capital to put in real estate – a safe channel during the pandemic, now need capital to focus on production and business, the market loses liquidity, leading to negative capital after a while. ‘virtual interest on paper'”, he stated.

Therefore, experts affirm that no matter which investment option you choose, this is still the only time for investors with a stable financial foundation, the ability to control leverage and owning assets. good liquidity.

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