HÀ NỘI – Việt Nam’s real estate market needs the Government to issue long-term policies to ensure sustainable growth in the future.

Nguyễn Thế Điệp, deputy chairman of the Việt Nam Real Estate Association, made this observation at a meeting between the real estate business community and the press on Thursday.

He said the local property market has had sustainable development over past years and transactions on the market have recovered since March with a growth rate of 4 per cent against February.

The domestic market has had a development circle of 5 years to 10 years, he said, but if the market faces changes in policies during a process of recovery, growth on the market would reduce and the market would need time to recover.

Meanwhile, property projects need large capital and enterprises did not themselves have enough capital and needed loans for their projects, he said. The changes in credit policies for the property market, such as the VNĐ30-trillion package and the Circular 36, would create great impacts on the property market.

Therefore, Điệp said the market needs the long-term and consistent policies to suit its development circle, and avoiding a gap between the market and the policies.

The policies should give preference to investors to approach good financial sources and solve demand on social and cheap houses, he said.

According to Điệp, there is strong growth in demand on social housing, especially in urban areas so enterprises should have business strategies for the buyers to easily approach the social housing projects.

House prices up

The real estate prices inched up in April, particularly the cost of homes in Hà Nội, according to the Department of Housing and Real Estate Market Management under the Ministry of Construction.

Hà Nội saw a slight price increase of between 3 per cent and 5 per cent in residential buildings in the districts of Hà Đông, Cầu Giấy, and Southern Từ Liêm.

Meanwhile, the housing prices in HCM City remained stable for the month.

Both localities saw improvements in sales volume with a 6 per cent increase and 1,250 successful transactions in Hà Nội, and 7 per cent and 1,150 successful transactions in HCM City.

Positive signs were also witnessed in other localities, such as Đà Nẵng, Khánh Hòa, Kiên Giang, and Bình Dương, particularly in hi-end projects and tourism facilities.

Inventory down

The real estate sector reported a reduction of nearly VNĐ3.4 trillion (US$152.5 million) in inventory in April, from the previous month, to an estimated value of VNĐ41.5 trillion ($1.86 billion).

The department said the highest inventories were recorded in residential and commercial land for projects located far from cities with insufficient infrastructure. They were estimated at more than 6.3 million square metres and valued at VNĐ21.5 trillion ($964 million).

This was followed by town houses with 6,179 units worth VNĐ11.5 trillion ($515.7 million). Unsold apartments stood at 5,959 units, equivalent to nearly VNĐ8.5 trillion ($381.1 million).

Unsold properties in Hà Nội were calculated at VNĐ6.1 trillion ($273.5 million), a decline of VNĐ125 billion ($5.6 million) from March. Most of the inventory was in townhouses with 2009 units, while the apartment segment witnessed a sharp fall in its inventory with only 187 units in stock.

The total inventory value in HCM City was VNĐ7.7 trillion ($345.3 million), falling VNĐ607 billion ($27.2 million) from last month, mainly in the apartment segment, followed by residential land.

M&A in Q1

Meanwhile, JLL Vietnam, a real estate services firm, said mergers and acquisitions (M&As) on the domestic market continued where it left off in 2015 with deal volumes increasing in the first three months of this year and many successful transactions.

Notable M&As in the first quarter included TNR Holdings’ purchase of TNR Tower in Hanoi from Vingroup for $110 million. Keppel Land spent $93.9 million to buy part of the Empire City project in HCM City’s District 2 from Empire City Ltd, while Hyatt and Thaigroup bought a hotel in Hà Nội for $165 million.

JLL Vietnam said many projects are attracting investors such as A&B Tower in HCM City’s District 1, the Nam Hải Resort in central Quảng Nam Province and the Six Senses Côn Đảo resort in southern Bà Rịa-Vũng Tàu Province.

The company also reported great interest from investors from the Republic of Korea, Japanese and Singaporean in Vietnamese real estate. It forecasts more M&As this year thanks to improvements in the market and growth slowdowns in some regional countries. – VNS