Housing developers in the country especially in HCM City will shift from luxury apartments to the mid- and low-end segments next year, experts have said.– Photo nld.com.vn
Housing developers in the country especially in HCM City will shift from luxury apartments to the mid- and low-end segments next year, experts have said.
In its latest analysis, the HCM City Real Estate Association has made a similar forecast.
Le Hoang Chau, its chairman, said there would be a big change in the market to address the imbalance in supply.
While there is excessive supply of high-end housing, there is a dearth at the lower end, he said.
There would be a shift towards affordability next year, he said.
He cited Vingroup’s announcement it would build 200,000-300,000 apartments in the next five years at prices of VND700 million-1 billion (US$34,000-49,000).
Many other major developers like Him Lam Land, Khang Dien, Sacomreal, FLC, Vihajico, and Nam Long also plan to build affordable apartments.
Le Xuan Nga, general director of World Star Land, told a conference this week that transactions in the high-end segment have reduced this year, especially in HCM City.
Next year the property market would witness a new trend of developers focusing on the mid- and low-end segments to meet demand for housing, he added.
Vo Thi Diu Hien, general director of PHP Real, said the national housing market is driven by the low- and mid-end segments.
In 2013-14 they had helped the market recover from a recession, but were ignored in 2015-16, causing a shortage, she said.
Next year these segments would grow strongly, stabilising the market, she said.
Do Thu Hang, a senior official at Savills Vietnam, predicted national housing, especially in the low-priced segment, to surge to meet the unfulfilled demand.
Thoi Bao Kinh Te Viet Nam (Vietnam Economic Times) quoted her as saying that 2.6 million workers work in industrial zones and the number increases by 200,000 a year.
Three-fourths of them are migrants with an average income of US$2,500 a year, and this is a promising sign for the market, she added.
Experts said other segments too would grow next year but not strongly.
Nga of World Star Land said high-end supply would still increase but only strong developers would succeed.
Nguyen Duc Thanh, head of the Viet Nam Institute for Economic and Policy Research, said other property segments like hotels, offices, and industrial lands would stagnate next year due to changes in the global economy.
Until two or three months ago many foreign investors were coming to Viet Nam to explore investment opportunities, but the numbers have dried up now, he said to explain why the segments would slow down.
Nguyen Tran Nam, chairman of the Viet Nam Real Estate Association, said overall the market is thriving thanks to the stable economy, rapid urbanisation and improving living standards. — VNS