No bubble expected from rising land prices

Saturday, Oct 24, 2015 08:00

A conner of Da Nang City. — File Photo

HA NOI (VNS) — Land prices in central Da Nang City have been rising from the beginning of this year but industry insiders do not see any risk of a property bubble occurring.

Dau Tu Bat Dong San (Property Investment) newspaper reported Huynh Thi Thanh Thao, deputy director of Thien Kim property trading floor as saying, property prices were seen rising by around 30 per cent in the city's centre and even up to 100 per cent in beachfront areas.

Despite that, Thao did not see risks of a property bubble occurring in the central city, saying that the rise in prices of Da Nang properties came from a combination of stimulating factors driven by the city's tourism potential and developed infrastructure.

Thao cited her trading floor's statistics which showed that 70 per cent of land buyers were coming from the big cities with the main purpose of building houses, hotels and restaurants.

Statistics from the municipal Department of Culture, Sports and Tourism, Da Nang City revealed more than 3.7 million tourist arrivals in the first nine months of this year, up 23.6 per cent over a year ago.

What was different from previous years, was that buyers were now eyeing land rather than other property products, Thao said, pointing out that land prices in the central city remained cheaper than Ha Noi, HCM City and Nha Trang, in addition to an abundance of choices with promising profits.

Sharing the same viewpoint, Tran Van Binh from Sunland Company said that Da Nang's socio-economic development also helped to make the city's property market more attractive.

Earlier, Do Thu Hang from Savills said that the Da Nang property market had huge potential for development with an international airport ensuring good connectivity, recreational centres, beach and many beauty spots.

The regulation allowing foreigners to buy houses in the country was also expected to boost the demand for the property market in the central city, she said.

Property experts expected tightened management by local authorities in land transactions to help prevent a bubble.

At the city's meeting on September 24, local watchdogs warned about the occurrence of land purchases by foreigners under the name of Vietnamese, which might push up land prices, and asked for efforts to prevent this. —VNS

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