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No bubble in HCM City, assures property industry association

Update: November, 09/2016 - 09:00
There will be no real estate bubble in HCM City in the last quarter of this year, the HCM City Real Estate Association has assured. — Photo motthegioi.vn

HCM CITY — There will be no real estate bubble in HCM City in the last quarter of this year, the HCM City Real Estate Association has assured.

Lê Hoàng Châu, its chairman, said the year-end is always a time of growth for the market and this year is no different.

But the market is showing signs of slowing down compared to last year, and this would continue into 2017, he said.

He dismissed fears of a bubble, saying it would only form in a rapidly growing economy.

“This year it is difficult to achieve the country’s GDP growth target of 6.7 per cent. Our economy is still in recovery mode.”

Furthermore, credit policies are being tightened, he said.

But there is a risk in the high-end segment due to an imbalance between demand and supply, he said.

The association’s latest report clearly reveals this imbalance. With a mushrooming of high-end projects, supply exceeds demand, it said.

On the other hand, there is a shortage in the segments in which there is high demand -- social housing and housing costing VNĐ15 million per square metre.

The association said high-end projects are now proliferating not only in the city centre but also elsewhere, especially in the east.

Châu said: “The Government should have policies to balance the market and developers should restructure their projects, moving into segments with real demand and high sales.

“Consumers should decide carefully and not just follow trends.”

The market has recently seen a slight increase in prices in many projects, but it is a normal trend during the year-end, traders said.

Prices are up by VNĐ1-3 million (US$45-136) per square metre, they said.

Brokers said prices are up compared to the rates initially offered by developers at many projects like Centana, Palm City, Moonlight Residences, and Hưng Phát Silver Star.

Nguyễn Văn Đực, deputy director of brokerage Đất Lành, said prices are now up by 5-15 per cent. They are mostly mid-end projects by prestigious developers at good locations that have made good construction progress.

According to Đực, prices have increased most in the east and south where transportation is excellent. — VNS

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