Official real estate index suffers delays

Update: June, 10/2016 - 11:41
A section of Nguyễn Văn Linh Road in District 7, HCM City. — VNA/VNS Photo Kim Phuong

HCM City – The official real estate index, which should have been set up earlier this year, has been delayed while real estate enterprises and associations have continued to provide their own indexes.

Property consultants like CBRE, Savills, Cushman & Wakefield and business groups provide various indexes but they are mostly different from each other.

The enterprises are also investors in and agents for many housing and other property projects, and the information they provide is mostly targeted at buyers.

“It is necessary to have an official real estate index. The index will require quality, accurate and updated information,” Phạm Thanh Hưng, deputy general director of Thế Kỷ (Century) Real Estate Company, said.

The information about urban plans, the primary real estate market and land fund must be highly accurate and practical, he said.

“The statistics from State offices and consultancies are not enough and cannot provide a comprehensive outlook for the market.”

After the decision to create an official index was made, a draft decree spelt out its nitty-gritty: price and volume of real estate transactions, the number of new housing projects, number of newly completed housing projects and average prices for new housing.

All values are to be updated monthly and reviewed every year.

The decree also demarcates the responsibilities of various agencies: the Ministry of Construction’s Housing and Real Estate Market Management Department will be responsible for inspecting, supervising and speeding up implementation of regulations on construction, management, use and exploitation, and updating databases on the real estate market.

The ministry’s Information Centre will co-operate with the department and the Construction Economy Institute to develop a market information system for real estate.

The ministry had planned to approve the draft on April 1, but has yet to do so.

A top official at the Construction Economy Institute revealed that opinions on the decree are being gathered from related authorities but no deadline for its issue has been fixed.

The ministry had issued Decree 20 in 2010 on creating real estate indexes in Hà Nội, HCM City, Đà Nẵng, and Cần Thơ, but the programme stalled after the market slumped.

Nguyễn Chí Dũng, deputy director of the Hà Nội Construction Department, was quoted as saying by website, “Hà Nội has just issued a list of solvent developers as stipulated in the real estate business and housing laws. We have also started to list completed real estate transactions every quarter but briefly and not with enough information.”

A senior construction department official in the northern province of Hải Dương said due to the paucity of human resources his department cannot create a database on existing housing, office and other commercial space and those to be finished in future.

“Fluctuations in the number of transactions and price in the [country’s] real estate market have not been recorded,” Trần Đình Thiên, director of the Việt Nam Institute of Economics, said.

Việt Nam should learn from Singapore, which has the Housing Development and Management Office that connects supply and demand and maintains information about housing transactions and sale of projects, he said.

The most important thing is how to maintain an accurate database and cull information from it to provide accurate transaction prices and volumes in various segments, he said.

“The work will support buyers and developers and ensure healthy development of the real estate market.” -- VNS