A view of Hà Đông District in Hà Nội. VNA/VNS Photo Tuấn Anh

HÀ NỘI The property market in Hà Nội’s continues to show signs of recovery as successful land auctions fetch higher prices, setting up a new price level for its surrounding districts and communes. However market experts and residents have been voicing concerns over those inflated prices. 

On Tuesday, 19 out of 40 land lots in the Vạn Điểm Commune, Thường Tín District, were sold at prices ranging from VND24.4 million to VND 52.8 per square metre (sqm), both many times higher than the starting price of VND3.86 million per sqm.

The auction, which granted land use rights of just over 3,000 sqm, fetched nearly VND125 billion for the State coffers. As many as 199 bidders participated in the auction, with deposit amounts ranging from VNĐ99 million to VND205 million. According to the local auction committee, the 21 remaining land lots were not granted as bidders failed to follow auction regulations.

Notably, the land lots are located close to a military zone, which doesn’t allow the construction of buildings higher than two stories and building density greater than 68 per cent.

Earlier, a similar auction in Hà Đông District on October 19 granted land use rights of 27 lots in Dương Nội Wards with the highest winning bid at VNĐ133 million per sqm, nearly six times the starting price.

Talking to the press, several bidders expressed concerns over the high prices, saying there may have been individuals who purposely inflated prices far higher than the previous level. They said many bidders had to quit halfway, as they could not keep up.

Property market insiders and experts have long voiced their concerns over the limited supply in recent years, which has been driving prices up, as well as a new regulation that requires newly developed land lots to be at least 50 sqm in size. Speculators and hoarders only make matters worse, making affordable housing out of reach for many working-class families.

Vice chairman of Thường Tín District People's Committee, Phan Thanh Tùng, said as of October 22, the district had collected about VND694 billion from land auctions. He said the district will continue auctioning around 44,546 sqm of land this year, including 47 more lots in Vạn Điểm Commune, with 22 lots scheduled for October 27. Tùng said the size of the lots range from 234sqm to 489sqm, with a starting price of VND3.86 million.

Before the end of October, 27 lots from Đồng Cống and one lot from Vân Trai, in Tây Đằng Town, Ba Vì District are scheduled to go under the hammer. These lots range from 65sqm to 121sqm, with starting prices between VNĐ2.9 and VNĐ3.1 million per sqm. In Mỹ Đức District, an auction for 18 lots in Hùng Tiến and Hợp Tiến Communes is scheduled for October 31.

Meanwhile, other auctions have been postponed for review as the respective district-level government said they were in the process of updating and adjusting the auction procedures under Decision 61/2024 from the city’s People’s Committee. 

Earlier in Hoài Đức District, of the 19 successfully auctioned land lots in August not all the buyers have completed the sales.

"The total amount paid by the auction winners in the first round is 50 per cent, amounting to about VNĐ70 billion. Currently, seven clients who won eight plots have fulfilled their financial obligations before November 27, 2024. If they do not pay the full amount on time, they will incur late payment interest," said Nguyễn Huy Hoàng, director of the Hoài Đức District Land Fund Development Centre.

Representatives of the Hoài Đức District government said that the process of organising land auctions in the district strictly adheres to legal regulations, especially regarding the handling of cases that have not completed their financial obligations for the 19 successfully auctioned plots. VNS