Based on specific figures recorded over the past three years, many experts said the local real estate market will see a quite bright scenario. Investors can pour their money in the realty market in different ways from now to the late year. However, investors should also be careful with “weak” projects facing the high risk of failure.
More opportunities for loans for real estate purchasing
Providing loans for realty projects is one of the key retail products which should be boosted in the current credit policies of many commercial banks.
Many commercial banks, including foreign banks’ branch, have offered more property loans this time because they recognise the market’s potential.
The growth rate of property outstanding loans in the first four months of this year increased 0.5- 1 per cent per month. The ratio of reality outstanding loans of banks in Hanoi and Ho Chi Minh City accounts for 10 per cent of the total outstanding loan. Of the sum, the outstanding loan ratio of several big commercial joint stock banks makes between 14-20 per cent of the total loans.
Unlike early this year, property loans were only offered to individuals who buy houses and land. Currently, along with medium and long term subsidized loan packages, many banks have targeted enterprises which have specialised products such as realty loans and support for contractors’ package projects.
Most banks are seeking to set up strategic relations with investors of big projects such as HUD, Vinaconex, Phu My Hung new urban area and Thu Duc House.
Stable supply source
According to forecasts, in the remaining months of the year, the realty supply source will be remarkably improved, particularly social houses. Besides, the state will continue expanding the supply forms, including low-cost houses, house for rent and hire-purchase. Around 148,000 apartments covering a total area of 9.58 square metres will be built in the 2009-2015 period. Companies which enter cheap house projects will get priorities in tax reduction and land use as well as several other benefits.
Offices for rent are predicted to continue falling due to the abundant new supply sources. Meanwhile, most big local firms have available headquarters; therefore, they will not hire more offices this time.
In the context of the global economic slow down, the realty market has become more quiet than before. Moreover, when the national economy has not yet shown recovery signals clearly, many companies are not eager to invest in realty projects, stabilising rentals of land space for business from now to the year end.
According to realty firms, realty business in both preliminary and secondary markets are at a standstill. CEN Value company said, in the secondary market, asked prices have generally dropped from 2- 7.5 per cent against the fourth quarter of last year, fluctuating from VND510- VND4,100/m2, depending on different types of apartments and excluding promotion types. Prices of apartments have tended to fall from 4- 8 per cent, even up to 20- 30 per cent. Many price evaluation companies said only the segment of popular apartment price have 5- 15 per cent. Experts said, the region of Ha Dong district (Hanoi) will continue dominating the market for its outstanding geographical location. At present many construction works are being carried out around Ha Dong, along belt road 70, Le Trong Tan extended road, Lang-Hoa Lac and many roads connecting Le Van Luong and Nguyen Trai and Tran Phu streets. Hanoi’s areas which see strong infrastructure development include Nam Thang Long, Tay Ho, National Highway 32 and Hoang Quoc Viet extended road.
The Vietnamese property market late this year will be different from the market of late 2008. Analysts said good signs will be witnessed in the market without the fever, also warning people of “infeasible” projects. Investors should consider which market segments should be invested in to prevent losses.
Luong Tuan
Vietnamese
