Ke eight ounces, the pound!

Supply is “drip”, volatile prices increase

Perhaps, the move of “tightening” on the real estate market from taxes to credits… has been causing the opposite effects, as apartment prices still tend to increase, even stronger in the context of scarcity. new supply. Many theories have been put forward, if real estate prices are still on the rise along with tight movements of the real estate market, people’s opportunities to own houses are increasingly narrowing.

It can be seen that, from the beginning of the year until now, in Ho Chi Minh City only a few new apartment projects have come to market. The average price of the premises is from 50 million VND/m2 or more. Although this price has increased compared to the same period last year, the liquidity is stable because the supply is not diversified for buyers to choose. For example, in the South area, there is currently a high-class isolated apartment complex Flora Panorama in Mizuki Park urban area, offering prices around 50 million VND/m2. Meanwhile, in the West area, the Flora luxury apartment complex in Akari City phase 2 is also “alone” on the market, with a selling price of less than 48 million VND/m2.

In the East area – which is the place with the most abundant supply in Ho Chi Minh City, since the beginning of the year, only a few apartment projects have launched. For example, the Fiato Premier project with a scale of 400 apartments is introduced at a price of 55 million VND/m2. Currently, this area is about to offer podium shophouse products with about 50 units. Or, some previously sold projects such as Urban Green, MT Eastmark City are also new “drip” supply in the real estate market in this area.

It can be seen that the product supply is small, while the demand for real estate in Ho Chi Minh City is still stable, there is no reason for the project investor to reduce the selling price. Looking at the asking price of apartments on the Ho Chi Minh City market, it shows that price competition is taking place. In which, the common ground is that the price is no longer low. This “eight-pounder, half-pounder” competition tells the story: Real estate prices are still on the rise, and will even increase sharply in the future when there is no sign of an improvement in supply.

Meanwhile, in the high-end price segment belonging to the product line of townhouses, villas, villas or luxury apartments in the center of Saigon, there are almost no prices below 200 million VND/m2. This shows that the tighter the squeeze, the lower the housing supply, the more real estate prices increase, and the more difficult it becomes for people to buy houses.

If the credit valve is locked, the already difficult real estate will be even more difficult

In fact, the real estate market in Ho Chi Minh City has experienced many difficulties in recent times due to the epidemic. Supply has not shown any signs of improvement since 2 years. With policies to tighten credit or tax … at this time, according to some experts, it makes the market even more difficult.

In addition to the legal problems and difficulties that caused the housing supply to decrease, banks have now stopped providing new loans and even stopped disbursing loans for previously signed credit contracts. That makes it impossible for businesses to carry out unfinished projects or new implemented projects.

Not to mention, rising construction material prices also put pressure on real estate prices. After a sudden price increase in the first 3 months of the year, iron and steel prices at the end of April have cooled down thanks to the decrease in input material prices. However, the price of iron and steel is still higher than the end of 2021 by a million dong/ton. The Ministry of Construction forecasts that prices of essential construction materials such as cement and steel will continue to increase. This will affect the price of houses and construction works to increase even though real estate prices have continuously increased over the past time.

An industry expert analyzed: With input costs rising, contractors are now even more difficult when most investors ask for an extension of the payment schedule due to capital constraints. Even some contractors who are doing unfinished works were forced to pause because the investor was stuck in capital and slow in payment, so they did not have money to pay the cost of labor, cement, iron and steel… The economy struggled. After recovering from Covid-19, inflation pressure is heavier and heavier while the house price index of our country is now 20 times higher than the average income of the society. The dream of buying a home for many households and individuals is increasingly far away.

Not only the capital flow from the Bank is being squeezed, the channel of mobilization from bonds is also frozen. A report from the Vietnam Bond Association showed that in April, there was no capital mobilization of real estate enterprises. The capital flow from the new lending bank is limited, the bond mobilization channel is “stagnant”, and the issue of shares is also sluggish due to the sharp drop in the stock market, making completed real estate projects less and less likely to appear. The gap between supply and demand continued to be pushed far away.

Apartment price war in Ho Chi Minh City: Eight-pound people, half-pound people!  - Photo 1.

According to experts, if you squeeze capital into real estate, you are also “strangling” the supply of the market

Thus, the dwindling supply, rising real estate prices, plus difficulties in accessing credit may push the real estate market into a state of “difficulty” piling up. Therefore, according to experts, credit valves cannot be “locked” to real estate.

According to Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, housing prices increased too high, mainly due to the lack of supply. The source of goods is scarce, most of which is a backlog of goods to buy and resell while the demand for investment and housing sales is increasing, so the price is pushed up very high. Accordingly, limiting cash flow into the real estate market segments “traders”, land speculation is necessary to reduce the rhythm of “land fever” and stabilize the market. However, it is not possible to simultaneously squeeze all the real estate market in general. If you continue to tighten without consideration, the market will immediately “stand still”, many economic sectors will collapse under the domino effect like during the economic crisis that took place in 2008.

Also recently shared in the press, Dr. Vu Dinh Anh said that real estate is a very important part of the economy. Real estate is always associated with finance and will not be able to handle real estate related issues if separated from finance. On the contrary, it is not enough to talk about finance without talking about real estate.

“In my opinion, the word ‘squeeze’ should not be used. The problem here is not to tighten or tighten or control… but instead to make it healthy, not to suffocate. Because bank credit is actually This is not an appropriate source of capital for real estate, including term, risk and mortgage, but it is clear that now businesses have no other option but have to look to other capital mobilization channels such as stocks. , bonds”, emphasized Dr. Vu Dinh Anh.

According to Ha Vy

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