Apartment Prices in Vietnam Spiralling Downwards

Apartment Prices in Vietnam Spiralling Downwards

Transactions in the local real estate market have come to the standstill since the middle of 2004, especially in the field of apartments. In contrast to 2003 which was considered the golden time of tenements when buyers had to queue to buy when projects were still on the drawing board, contractors now they have to actively seek buyers.

Best selling and best priced is the Ciputra Apartment complex in Hanoi which is based on a fantastic location and was built by a prestigious contractor A complete 5^th floored apartment of 148 sq.m is priced at nearly VND2 billion, while those on the 3^rd floor are 150 sq.m and are being advertised at USUSUS$105,000, the original price stood at USUSUS$81,000.  A speculator in this area can pocket VND300-600 million for early registration for an apartment.

Meanwhile, prices of other new tenements range from between VND8 million and VND10 million per sq.m, doubling the original prices. Buildings regarded as being highly stable are the International Thang Long Village and Linh Dam Peninsula. Realty experts remark that except for some high-grade apartments, all are falling in price, from between VND50 and VND70 million per apartment.

However, financial and technical problems arising around apartment projects over the past have discouraged buyers who are now wavering upon buying an apartment.

Experts forecast the apartment market will be freed from the current predicament with an increase in apartment construction projects. This can be seen clearly as a series of apartments in old tenements like Thanh Xuan, Kim Lien and Trung Tu are being advertised at VND300-450 million each, remarkably lower than two years ago. Are local residents too tired of waiting for the upgrade of these apartments?

• K.P