The "house-changing house" solution is expected to become a catalyst to open up the secondary real estate market, creating an opportunity to raise living standards for many Vietnamese.
The report of market research units noted that the secondary real estate market in Vietnam has grown by nearly 3.5 times in 8 years (2010-2018). However, the scale is still 10 times lower than the average of developing countries in the region. If promoted, this market could generate an additional trading volume of more than $25 billion by 2025.
“The secondary housing market has not really developed because most people do not want or do not want to sell their houses. Most apartments in Vietnam have been built in the last few years and residents have not lived in these apartments for a long time, so they have not considered selling their apartments, "said an expert.
Lessons from Singapore
In Singapore, the secondary housing market developed thanks to a series of policies. In the 1960s, the island nation faced a similar situation to Vietnam, when it had to simultaneously renovate old apartments and create transactions for the secondary market. Every year, Singaporeans need to add 15,000 new homes as the population grows by 4.3% per year. The limited land fund causes a serious shortage of housing supply. Most of Singapore's population lives in old, cramped apartments.
In that context, the Singapore Housing and Development Authority and the Central Defense Fund were established to address housing demand, positively impact the real estate market, develop sustainably, and promote regulation. urban planning.
A series of policies have been implemented to promote the home ownership rate of Singaporeans
At first, the Housing and Development Authority of Singapore leased it short-term or sold it to people in the form of a 99-year long-term lease, and provided loans to help homebuyers. This flexible policy has created a big change in housing supply in just three years.
This policy helps to increase people's home ownership rate. Statistics show the island's mortgage-to-GDP ratio rose to 10% in 1980, up from 4% in 1970.
In 1985, the market adopted a new trend – “houses in change”. During 1960-1985, apartments under the above program were sold on a first-come, first-served basis. Later, the households who already have a home look for ways to upgrade their home or change to another area that is more luxurious and comfortable. Since then, owners of houses built by the Government can take advantage of their own houses to change to new houses, change their living environment with apartments in a better location and with more amenities.
This is reflected in the volume of transactions of apartments sold by this agency. From less than 800 units sold in 1974, it increased to 31,000 units in 2004. By 2014, the percentage of people owning real estate exceeded 90%.
Policies to open up the real estate market have helped create new housing estates with high occupancy rates and near-zero inventory risk. The development of the housing market, therefore, also goes hand in hand with economic development. Between 1960-1999, the island's GDP grew by an average of 8% per year. Today, Singapore is the leading real estate investment destination in the region. Sales of luxury apartments here increased 72% in the first quarter of 2020 despite Covid-19, according to Propery Guru.
Percentage of population owning a home in Singapore, 1970-2015.
Experience for Vietnam
The "House Changer" solution contributes to the strong development of the secondary housing market in Singapore. However, to apply the same policy in other countries, it requires adaptation to the policy, business environment and market characteristics.
Experts say the policy has been successfully applied in Singapore partly because the island nation's population and area is quite small, and it has the financial potential to create effective housing development funds. Most of these two agencies are in the private sector, namely banks and real estate developers, so it is difficult to find breakthrough solutions.
With a modest scale compared to other countries in the region, the Vietnamese market is said to also need breakthrough solutions to stimulate the development of the secondary housing market, creating a driving force for economic development. development and improve the quality of life of the people.
Pioneering this goal in Vietnam, Masterise Homes cooperated with Techcombank to introduce the "Home for Home" solution with the expectation of raising the living standard of Vietnamese people, shortening the time to upgrade apartments, thereby contributing to improving the liquidity of the secondary market.
To do this, Masterise Homes has adapted the solution to the needs and financial capacity of Vietnamese people, thereby helping families have the opportunity to upgrade their lives from current accommodation to projects. luxury apartment in Vietnam without any payment until the date of handing over the new apartment. Applicable high-end projects include Masteri Waterfront, Masteri West Heights in Hanoi and Masteri Center Point in HCMC.
The "House-for-House" solution helps shorten the process of upgrading accommodation
In the past, people who want to change houses often follow the "sell house - find temporary housing - find a new home" route, which takes a lot of time and costs, leading to restrictions on selling and buying new houses.
With “Home for Home”, customers can use collateral which is existing real estate to receive 100% support of real estate value at Techcombank with the applicable interest rate of 0%, without any payment. any expenses from disbursement to receiving the house. When handing over the new apartment, customers can pay a minimum of 30% of the new apartment value, the remaining 70% can be paid in installments up to 35 years. During the entire journey of changing houses, customers only need to pay the initial refundable booking cost of VND 50 million to own an apartment developed by Masterise Homes. Thus, homebuyers will be able to be proactive and plan their finances in 2-3 years.
In the coming time, when global real estate prices are expected to increase sharply thanks to large support packages and the post-Covid-19 recovery, Masterise Homes' "House-for-House" solution promises to become a catalyst to open doors. secondary market in Vietnam.
This is also considered a strategic step of this developer to create a "Win-Win-Win" solution (three parties benefit). In addition to bringing benefits to the buyers participating in the program, the solution will also benefit the economy, in line with this business's commitment to creating sustainable values for the market.