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Friday, June 14, 2024

Real estate market woes persist

The Saigon Times

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HCMC – The real estate market in Vietnam is not yet out of the woods due to supply and liquidity problems, despite efforts to stimulate growth through interest rate reductions.

The Ministry of Construction has highlighted the significant shortage of supply across all segments, particularly in social housing and affordable commercial housing. Difficulties in accessing funding sources have hindered businesses from progressing with real estate projects, leading to mass layoffs and impacting social welfare and order.

In the first half of this year, only 25 commercial housing projects were completed, introducing approximately 10,000 new units to the market. This represents a 50% decrease against the same period in 2022.

Similarly, only four social housing projects were finalized, providing 934 units. On the other hand, eight combined resort and officetel projects were concluded, totaling nearly 3,900 units, up 33% over the fourth quarter of 2022. These included 2,500 tourist apartments, 680 villas, and 247 officetel units.

Property transaction prices have also declined. Condominium prices in various localities have dropped by 2-6%. Land prices within projects have fallen by 8-11%.

In terms of transaction volume, around 187,000 successful transactions have been recorded, accounting for 36% of the total transactions seen in the second half of 2022. The land segment has experienced the majority of these transactions, while condominium and landed-house transactions have significantly decreased, amounting to only 40% of the July-December period in 2022.

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