Housing Market: Adaptable to Growth

 

As advised by analysts, enterprises who want to survive recent economic fluctuations should change themselves and adapt to current trends. It is impossible to sit inactively and wait for the market to recover. “Adaptable to Growth” is the message from CBRE. Specialising in housing market analysis, CBRE has discovered market trends from the types of customers to their tastes, incomes and payment abilities. If suitable products are introduced to the market, they will be accepted. Such elements of success are appropriate sale prices, good acreages, proper terms of payment, good progress in construction progress, a convenient transport system and a real demand.

 

Currently, the infrastructure in HCM city is being completed with the growth of new residential areas. Accordingly, “location” is no long as important when choosing a house. As strategic locations are very expensive, a place with convenient transport links will be popular even though it might be outside of the centre.

 

Regarding time, customers want to buy houses now because prices are more reasonable, there are more options, the progress can be tracked, the date of hand-overs can be checked precisely and sale prices will be quickly estimated when the market rebounds. People buy houses to meet their real demands and not to speculate. Speculators in previous years made up 80 – 90 percent of market transactions. However, when credit was tightened (lending rates jumped up to 21 percent) and sale prices grew slowly or fell as they fled away from the market. Those who buy houses to rent remain small as the rental profits are low. For example, an apartment at HV Plaza, district No. 5 is sold at USD270,000 and leased at USD1,500 a month, thus the profit is only 8 percent.

 

Present customers look for houses of 50 – 80 square metres with 1 – 2 bedrooms that are sold at between VND600 million – VND1.5 billion (VND10 – 18 million a square metre on average). They are very interested in the construction progress and time of hand-over since many contractors have failed to fulfill their hand-over schedules. Construction progress also affects the terms of payment. Buyers used to pay 95 percent before hand-over, they are now requested to pay 70 percent before hand-over. Meanwhile, large investors must finish their housing contracts and hand over the new apartments in order to receive the other 70 percent of the contract in Thailand or Hong Kong.

 

Finally, to sell a house or an apartment at the moment, marketing too need revised, particularly pushing up online instruments like websites, emails, e-bulletins, television, and radio.

With such information, property developers can adjust their business strategies and are able to be successful.