Vietnam's real estate market has been “frozen” for 2 years, till now, villas and townhouses have discounted prices of between 9 percent and 13 percent, even many project owners accept a 50 percent discount, however liquidity has not improved.
Large inventory
The latest data of research companies and real estate management companies reveal that there are about 42,000 villas and townhouses unmarketable from 125 projects in Hanoi.
Ms Do Thi Thu Hang, Director of Research Office of Savills Vietnam in Hanoi said that, compared to other segments, liquidity of villas and townhouses is very low. Weak demand and abundant supply result in large and increasing inventories. Many villas and townhouses are discounted even to 50 percent however because customers still wait for deeper decline, transactions are rarely realized.
Moreover, many other projects are completed, therefore, people with real demand have many choices and can consider carefully before making decision.
Particularly, prices of villas and townhouses reduce from 13 percent to 9 percent respectively. Our survey showed that averaged secondary ask prices in Long Bien, Thanh Tri, Cau Giay, Tu Liem, Tay Ho, Hoang Mai vary from VND 41.7 million to VND158 million/ a sqm.
Among above mentioned places, Cau Giay, Tay Ho, Tu Liem offer highest ask prices, up to VND108 million a sqm. In Ha Dong, Dan Phuong, Hoai Duc, Me Linh, Quoc Oai, prices range from VND9 million to VND54 million a sqm.
However, real estate prices of suburb districts of Me Linh and Hoai Duc, once “the hot destinations”, have declined about 40 percent but customers are not interested.
Ms Nguyen Thi Oanh from Kim Anh Real Estate Exchange Centre in Hoai Duc dsitrict said: “Villa and townhouse prices have significantly declined, even many owners in need of money are willing to discount VND40 million a sqm, but this discount does not attract customers.”
Increasing supply
Many real estate experts said that, it takes f
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According to result of real estate market research of CBRE Vietnam, among 9,000 villas and townhouses in urban areas that have been completed for the last 3 years, 60 percent are not lived in yet. Therefore, CBRE proposed that discount pressure still exists, customers’ interest in this segment is going down gradually. Therefore, villa and townhouse market will not thrive unless project owners do not invest timely in facilities, relevant social infrastructure.
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rom 5 to 10 years to deal with all the inventories of villas and townhouses. Practical survey shows that many villas and townhouses in urban areas such as My Dinh II, Quang Minh (Me Linh), Van Canh (Hoai Duc), Xa La (Ha Dong), Viet Hung (Gia Lam) have been abandoned for many years.
In the context of “frozen” real estate market, recently, many project owners are considered a risk to offer villas and townhouses.
Viglacera Land offered 46 villas and townhouses in BT1, Dang Xa urban area in Gia Lam district. Each villa or townhouse has area of 132 sqm. – 371 sqm. at price of VND19 million a sqm of land and VND 6.4 million a sqm. of including VAT.
Also in quarter I of 2013, the market receives many complete projects like Dream Tower urban area (Tay Mo, Tu Liem), Western -North area of Linh Dam lake (TT1/TT4/TT6). Lately, Bitexco Corporation introduced to the market The Manor Park City urban area in Hoang Mai district. In the future, there are 76 projects scattering in 14 districts with total area of 10,2000 ha adding to villa and townhouse supply.
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