Photo: Duc Anh
Apartments in particular seeing steady supply as new year approaches.
Vietnam’s real estate market will continue to see stable development in the apartment segment with abundant supply in 2017, a conference in Hanoi on December 20 heard.
Mr. Nguyen Manh Ha, Deputy Chairman of the Vietnam National Real Estate Association (VNREA), told the “Prospects for the Real Estate Market in 2017 - Impact of Policy” conference that the country’s real estate market has seen steady development in apartments in 2016, with particularly strongly growth in high-end and luxury segment. “Stable development will continue in 2017, especially in the high-end and mid-end segments,” he said.
The luxury segment will not be as vibrant as in 2016 and the affordable segment will see more opportunities to grow but will be affected by government policy.
Mr. Tran Kim Chung, Deputy Director of the Central Institute for Economic Management under the Ministry of Planning and Investment, said that the structure of Vietnam’s real estate market will see movement from the mid-end and high-end to the affordable segment. “The market will focus on the actual living demand, so the market structure will move toward real needs,” he said.
Similarly, the supply of C-class apartments, according to Ms. Do Thu Hang, Director of Professional Services at Savills Hanoi, will witness a strong increase. “There are 2.6 million workers in industrial areas, with 200,000 more each year, of which 75 per cent are immigrants, 75 per cent are under 35 years old, and the average income is $2,500 per year,” she said. “The affordable segment is suitable for this market.”
In 2016 the policies of the government were advantageous for the real estate market. The State Bank of Vietnam (SBV) issued Circular No. 06, replacing Circular No. 36, aimed at tightening its regulations on asset-liability management and real estate loans. More policies promoted the development of the affordable segment, which is suitable for real demand.
Eleven new projects and the latest phase of one active project were launched in Ho Chi Minh City’s real estate market during the third quarter of 2016, supplying more than 4,600 units, for a significant decrease of 47 per cent quarter-on-quarter, according to the latest report from Savills Vietnam.
There were approximately 40,300 available units across all grades. Sales reached 7,500 units, increasing 7 per cent quarter-on-quarter and 43 per cent year-on-year. From the fourth quarter of 2016 to 2018, over 50,000 units are expected to enter the market.
In Hanoi’s real estate market, the total primary stock was 17,000 units in the third quarter, down 2 per cent quarter-on-quarter but 16 per cent higher year-on-year. Thirteen projects with fresh launches and ten newly-launched projects supplied 5,700 units, down 6 per cent quarter-on-quarter.
There were approximately 5,700 sales, down 6 per cent quarter-on-quarter and 15 per cent year-on-year. Over 13,000 units will enter the market in the fourth quarter of the year.