Affordable Housing Is Still Growing Well

 While the number of luxury apartments, mid-range sold out, the affordable housing is still up 10%. In the second quarter, 62,200 apartments are expected to be sold.

On April 12, Savills Vietnam Co., Ltd. released a report on the real estate market in Ho Chi Minh City in the first quarter of 2017. Accordingly, the property market in Vietnam has not shown signs of starting sharp.

Affordable apartments are still crowded with buyers

Of the 5,200 units sold in the first quarter, 47% was down compared to the same period in 2016. The total number of transactions in the quarter also fell 13%, reaching 8,800 units. Particularly, apartment transactions are up 10%. Market absorption was approximately 21%, down 1% from the first quarter of 2016.

Savills Vietnam forecasts that in the second quarter of 2017 the supply will reach 62,200 units. In District 2 and District 7 continue to occupy the supply in the future with about 21% market share each district.

In the segment of villas and townhouses, the primary stock declined by 14% in the first quarter, to only 2600 units. Trading volume was also not very good with 11% decrease compared to the fourth quarter of 2016. In which, Saigon East accounted for 74% of trading volume. The absorption rate was 34%, up 1% over the same period in 2016.

Expectedly from the second quarter of this year, the market will receive about 14 200 products from 44 new projects. East counties will account for 55% of total future supply.

In the retail segment, despite the steady supply growth, the empty floor area is still a difficult situation in the retail segment. Specifically, in the first three months of the supply reached about 1.1 million sqm floor area. Of which there are 8.400sqm from a shopping center and three new supermarkets. Also, in the first quarter, there was a closed supermarket that reduced the area to 5,500sqm.

In the segment of villas and townhouses, the primary stock declined by 14% in the first quarter, to only 2600 units.

“It is expected that in 2017, the market will have the 170,000sqm new floor, this is equivalent to 15% of the total floor area today,” said Pham Van Dai, Head of Research Savills Vietnam.

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For the office segment, a Grade C project in Binh Thanh entered the market offering more than 4,400sqm. Therefore, total market supply in the first quarter reached 1.6 million sqm.

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