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Local property market grows

Update: July, 09/2016 - 09:00
Viet Nam News

HÀ NỘI – The local apartment-for-sale market, which saw positive developments in the first half of this year, is expected to maintain growth till the end of 2016, experts said.

According to a CBRE Việt Nam report on the Hà Nội property market in the second quarter of this year (Q2), 6,100 new units were launched via 17 projects in Q2, a 19 per cent increase compared to the previous quarter, but falling 23 per cent year-on-year (y-o-y).

Sales continued to show positive signals. A total of 4,860 units were sold during this quarter, an increase of 20 per cent compared to the previous quarter, but falling 7.2 per cent y-o-y. It is noteworthy that the portion of transactions in high-end apartments reached a certain level, especially in newly launched projects.

In the first half of 2016, 8,900 apartments were sold, with mid-end apartments comprising 40 per cent, CBRE Việt Nam said.

In terms of pricing, it is noted that some projects had increased the price by four to 6 per cent compared to last year, especially those with good locations, situated at an average distance from the city centre, and in the vicinity of infrastructure projects that were under construction, it said. The rise in prices took place mostly in the high-end and mid-end sectors. In the high-end sector, prices rose in large-scale projects that had well-known investors and provided sufficient facilities and amenities. In the mid-end sector, projects with reasonable prices and good locations were in favour as there were greater chances for the investors to increase the resale price.

Meanwhile, the HCM City market saw a fall in sales volume of 5,887 units, a cutback of 45 per cent and 35 per cent on both y-o-y and q-o-q basis, respectively, according to the CBRE Việt Nam report on the HCM City market in Q2.

But the condominium market saw a continued strong increase in launch supply in Q2, adding 10,107 units, up 20 per cent q-o-q, but falling just 9 per cent y-o-y. This quarter reported the highest number of new launches in the mid-end segment, which accounted for 41 per cent of the total new supply.

“This led to the first concern about oversupply, when the sales volume could not catch up with the new launches every quarter,” the CBRE Việt Nam report said.

 “Despite a quiet Q2, CBRE expects the market to regain its momentum in the second half of 2016, as some developers plan to launch their new projects in HCM City’s market,” Dung Duong, director of research and consulting at CBRE Việt Nam, said.

The Jones Lang Lasalle (JLL) company said in the Hà Nội market, the large sales momentum in recent quarters would continue with most of the activity being in the affordable and mid-end segments till the end of 2016, while in the HCM City market, the sales of apartments were expected to remain at levels as high as in recent times.

Prices were expected to remain on the uptrend in the coming quarters in both markets, JLL said.

According to a forecast by Savills Việt Nam, 22,000 units in 41 projects, predominantly Grade B, are expected to be launched in the Hà Nội market in the second half of this year, focused in Từ Liêm, Thanh Xuân and Cầu Giấy districts.

In HCM City, more than 35,000 units are expected to enter the market between the third quarter of this year and 2018. Some developers have begun making strategic movements toward denser populated districts riddled with obsolescent housing in the west of the city.

Bảo Việt Securities Joint Stock Company (BVSC) also said in the first half, the high-end segment was still hot with many projects that offered an increase in transaction volume.

The mid-end segment remained the most stable with high demand and diversified products.

BVSC said the property market would continue to grow in the second half of this year, with more development of high-end projects and stability in the mid-end segment.

Competition in the market would increase further and the decision to buy property would belong to buyers, it said. - VNS

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