Vietnam’s real estate market will maintain positive growth rate during 2018 after three years of thriving and stable development, Pham Hong Ha, Minister of Construction, forecast.
According to Ha, Vietnam’s strong economic growth since 2015 has pushed the domestic property market into the positive development period that has significantly contributed to the country’s socio-economic growth during the period.
Upbeat signs have been seen in the market index, he said, stressing that property inventories have fallen sharply due to growing housing demand as the flow of foreign direct and indirect investment into the sector has soared.
The segments of land and small-and-medium sized apartments would have changed, in term of prices in some areas. Meanwhile, resort properties will continue to develop,” he said.
However, he said the market has not been synchronous and displays a lack of transparency, along with risks. Further, part of the real estate market has been dominated by group benefits.
Currently, investments for property trading have not been diversified, and they mainly come from credit institutions, bank loans and mobilizing from home buyers. The investors’ ownership capital has remained low, while some large estate developers use bank loans through their subsidiaries, thus causing difficulties for controlling credit in the real estate sector.
“The structure of property products has not been suitable or closely managed. The supply of hi-end estate segments has been higher than demand while lacking in commercial and social housing projects,” the minister added.
In addition, he said, the State management agencies have not developed policies to respond to changes in the market. Also, the Government has not had adequate policies regarding taxes, credits, and land, to regulate resources for the property market development, and has not encouraged social housing projects.
Echoing Ha, Nguyen Tran Nam, chairman of the Viet Nam Real Estate Association (VNREA), also said that the estate market would be more stable next year.
“The association has not provided warnings on speculation. The speculation would be seen when there was a lack of products, as well as some surplus, which raises prices,” Nam explained, adding, however, the country’s supply of property in the market has been abundant.
Statistics indicate that Ha Noi has some 20,000 apartments for sale. In total, the capital and HCM City has 45,000 to 50,000 apartments that are being offered for sales in the market, while consumption results in only 30,000 sales per year. Therefore, the market has enough apartments to meet current demand.