The Vietnam Real Estate Brokers Association forecasts that the scarcity of supply plus land tax, raw material prices, and rising labor costs may cause housing prices to increase soon.
A recent assessment of the impact of COVID-19 on the real estate market, The Real Estate Brokers Association said that the 4th outbreak caused most of the real estate projects being implemented across the country to stop construction because of the social distance and interrupt the production chain, supply of materials and equipment.
Projects that are in the process of being prepared for investment cannot be implemented because the government agencies in the provinces and cities also have to fight the epidemic, so the supply in the market has no chance to improve. Real estate transactions were also seriously affected because it is impossible to meet, exchange, deliver or notarize transactions while real estate is a special and high-value commodity that undergoes a lot of legal and appraisal stages when transaction.
The report of the third quarter of 2021 of the Vietnam Association of Realtors (VARS) shows that the total number of products offered for sale on the national market in the third quarter of 2021 reached 35,852 products, the transaction reached 16,647 products. (40.9% rate). In which, the apartment housing segment has the largest volume with 7,120 products (accounting for 48.6%), second by land with 5,349 products (accounting for 36.5%), and low-rise housing with 2,178 products (accounting for 2,178 products (accounting for 14.9%).
During the period, the entire supply in the market was mostly inventory from previous quarters. The products and new projects are very limited and have not improved and are almost the lowest in the last 5 years.
Looking at the market in the last three months of the year, Mr. Nguyen Van Dinh, Vice Chairman of VARS said, In October 2021, many big cities and many provinces completed vaccination, along with screening and isolating people infected with COVID-19. This will create a lot of safe green zones.
This is time for the localities to gradually remove the restrictive measures against the epidemic; at the same time, reactivate production activities and economic development in the new normal context, including the real estate transaction market.
However, Mr. Dinh said that the supply in the market has not improved much, projects that are completing investment preparation procedures (the number is very large) will certainly still face many difficulties and cannot enter the market right at the end of the year. The supply of land plots in the market is largely not located in approved projects, but mainly in local auction projects and spontaneous projects of small investors.
"The amount of supply in the whole market has reached the lowest level in the past 05 years and it will be difficult to increase sharply in the next 03 months. The scarcity of supply coupled with land taxes, rising prices of raw materials, equipment, and labor costs may cause housing prices to continue to increase in the coming time," Mr. Dinh predicted.
Talking about the absorption capacity of the market, Mr. Dinh said that although the transaction will change, with the projects that do not adjust but still keep the selling price as high as at the beginning of the second quarter of 2021, the consumption rate will certainly be low.
In the last 03 months of the year, real estate developers and contractors that have been severely affected by the COVID-19 epidemic can recover their health to normal by about 50%. Many service businesses and real estate brokers are weakening, unable to resume operations in the fourth quarter of 2021, and the number of businesses that can recover is estimated at 30%. However, the market will also appear some new businesses entering.
Besides, customers who want to buy houses recover, and demand will increase compared to the third quarter but not at a high level in the fourth quarter of 2021, estimated at 30% of the demand to buy houses compared to the same period in 2018, 2019. Real estate markets in localities such as Quang Ninh, Hai Phong, Bac Giang, Thanh Hoa, Binh Thuan, Long An, and Phu Quoc are likely to be active again soon.
Regarding the resort segment, according to VARS, the market will attract and interest from investors. Vibrant areas of real estate tourism and resorts are predicted as Quang Ninh, Hoa Binh, Thanh Hoa, Quang Binh, Ninh Thuan, Binh Thuan, Phu Quoc.
Collected from the source
Phuong Uyen
