In 2020, the real estate market has faced an increase in prices due to a shortage of supply. This stems from the fact that many projects have to review their legality. Many experts believe that, by 2021, if this "knot" cannot be removed, the market may have a negative situation.
Unusually bullish market
The latest report of CBRE Co., Ltd shows that the selling price of apartments in the primary market in the fourth quarter of 2020 was recorded at an average of 1,412 USD/m2, up 3%/year. The whole market has about 18,500 apartments sold in 2020, higher than the number of new launches. The prices of newly launched projects are higher than those of previous projects thanks to the improvement of utilities and better connectivity. Notably, high-end projects were first introduced in Gia Lam district, Long Bien district, setting a new price level in the East area. This is an important factor contributing to the price growth of the Hanoi market in 2020.
CBRE Vietnam forecasts that, in 2021, the average selling price of apartments in Hanoi will increase by 4-6% compared to 2020, driven by the launch of high-end projects in prime locations. In terms of supply, the market will improve in the range of 24,000 - 26,000 units, expected to expand strongly into new residential areas, while developed areas continue to upgrade their positioning. Therefore, affordable projects are forecasted to move further away from the Ring Road 3 area.
Mr. Nguyen Van Dinh - Vice Chairman of the Vietnam Real Estate Brokers Association said that in 2020, although the economy faces many difficulties due to the Covid-19 epidemic, the selling price of real estate in the whole Hanoi market unexpected increase. For example, 2 years ago, low-income apartment projects were all offered for sale at the price of 12-14 million VND/m2, but now it has increased to 16-17 million VND/m2. Luxury apartments have increased from 30-35 million VND/m2 to 40-45 million VND/m2.
For the land market, there was an increase of 30% compared to the previous time. In particular, a series of old projects in the West of Hanoi has skyrocketed to 70 million VND/m2, double that of the beginning of the year.
“The increase in house prices is explained by problems with lengthy legal procedures, making the supply scarce. If we don't control it well, Vietnam will have a bubble situation. Virtual prices will create the risk of a market crash. It is a very dangerous thing,” said Nguyen Van Dinh.
Supply will be improved
At the final report meeting of the Ministry of Construction that took place in Hanoi, Chief of Office of the Ministry of Construction Ta Quang Vinh said that next year, the Ministry will focus on basically solving the market supply to serve the needs of the market. housing demand for people. In particular, special attention is paid to the improvement of policies and programs to support and promote the development of social housing and low-priced commercial housing.
“The ministry will develop and submit to the Prime Minister for promulgation the National Housing Development Strategy for the 2021-2030 period, with a vision to 2040. This strategy will fundamentally innovate housing development thinking and policies. society, allocate enough land fund, supplement policies to attract social resources for housing development. In parallel, perfecting the legal system, mechanisms and policies so that the real estate market develops stably, overcoming the supply-demand mismatch. In particular, focus on encouraging the development of real estate products to meet the great needs of society such as social housing, low-priced commercial housing "- Mr. Vinh emphasized.
In addition, in order to add more supply to the market next year, the program to renovate old apartments will also remove obstacles in site clearance and planning. The Ministry of Construction will propose to the Government. The government promulgates a specific mechanism for the city. Hanoi and Ho Chi Minh City.
In the immediate future, the Ministry of Construction will require localities to prioritize the inspection, review and assessment of load-bearing safety of old and dangerous houses and public works in urban areas; complete the formulation, approval and announcement of the plan to renovate and rebuild the old apartment building in the area...
Then, make planning, approve and announce construction planning of subdivision 1/2000, detailed planning 1/500 of areas, projects with old apartment buildings as the basis for implementation of renovation, rebuild; study and promulgate according to its competence specific mechanisms and policies to encourage construction investment support and compensation and support for resettlement when implementing projects on renovation and reconstruction of apartment buildings; proactively create a house fund, a land fund to arrange resettlement, arrange temporary residence and organize the relocation of households living in old apartment buildings that are in danger.
According to the Department of Housing and Real Estate Market Management - Ministry of Construction, in Hanoi, in 2020 the price of luxury apartments will increase by 0.5%, apartment buildings will increase by 2-3%, land plots will increase by 5-10%. . In the city. Ho Chi Minh City's growth rate was higher than Hanoi, in which apartment buildings increased by 5%; land plot increased by 15%.
