The Ministry of Construction has said HCM city need to publicize planning information of the areas as well as improving projects from transportation, infrastructure and real estate avoiding situation of land prices increase according to “rumors”.
Avoid” land fever” due to “rumors”
Regarding “land fever” at HCM city, the Ministry of construction has recently asked the construction Department of HCM city capture situation and report properly this people’s Committee of City deploy appreciate measures to stabilize the market, avoid occurring the status of land prices increase under” rumors”.
Whereby, The Ministry of construction has suggested HCM City need to publicize planning information of the areas as well as improving projects from transportation, infrastructure, and real estate. At the same time, functional agencies should organize inspection groups to conduct real estate business, promptly correct sale of land in contravention of regulations at the hot spots, propagate widely in people on the information and rumors losing people to know and do not catch fever…
Read more: Vietnam Real Estate News
The Ministry of construction has confirmed” if implemented well, these solutions will have the stabilizing effect on the land market in these areas.
From the beginning of the year, the market has experienced “virtual price fever” in the land segment in coastal districts and some districts as District 9, District12, Thu Duc District, Binh Tan District, Nha Be District, Binh Chanh District, Hoc Mon District, Cu Chi District, Can Gio District.
Through surveys market, during one year, Land prices have increased over 30%, especially in areas where prices rose to over 70%. for example, Land prices in some subdivision areas in District 9, Thu Duc district and Binh Chanh district rose to over 910 USD/sqm, Land price in Can Thanh town, Long Hòa commune is up to 460-550 USD/sqm, agricultural land prices in some areas in Hoc Mon district, Cu Chi District has increased to over 50% in first four months of 2017, of which the frontage of National Highway 22 has also reached over 910 USD/sqm .
According to Le Hoang Chau, the Chairman of HCM city Real estate association, traders and brokers are the profitable players in the current virtual price boom. This fever is very dangerous and has been impacting negatively on real estate market, distorting the market, hiding many risks, threatening the healthy and sustainable of the development of real estate market. Horea thinks that there should be measures to cool down in time, effectively, not to happen to burst “bubble”, damage chain in the real estate market and to protect consumers.
Information is a core element
Le Hoang Chau, Chairman of the HCMC Real Estate Association (HOREA), said that in Ho Chi Minh City, seven floors have been hit. This difference only lies in the suburban land segment that is not landed in real estate projects. Especially, the nature of this fever is related to the issue of separation of land plots, the sale of the ground floor in which the top sellers, the landlady hides the land owner background level of impact is not large to the whole market.
Compared with 2007, the fever of real estate is very clear in the segment of high-end housing, this time it is subdivided land for sale into many areas of the city. In 2007 and 2010 the nature of the fever was more serious to the extent that the government had to issue tight credit resolutions, so the market from the bubble fell freezing. However, this fever has not reached such a level, the government has not issued regulatory documents. Meanwhile, the Government is implementing a roadmap to tighten credit on real estate so it does not affect the whole market but only negatively affects consumers and investors leveled in this segment.
“The city has made drastic directives so the virtual fever is being cooled. Coming to the city to issue a new decision replacing Decision 33 will help regulate the land segment into stability. Come back “Chau said.
In another perspective, Phan Cong Chanh, an independent real estate expert, said that information is the core factor leading to the current earthquake in the vicinity of Ho Chi Minh City. In particular, information including 3 elements such as planning, super projects, and infrastructure will make land prices change very fast and much. Hoc Mon and Cu Chi are the places where super project information is appearing. Can Gio, Nhon Trach information about changing infrastructure, namely bridge construction; District 9 is undergoing major changes in both infrastructure and planning so land prices fluctuate rapidly in the short term. Individual real estate investors need to understand this information principle in depth.
According to Mr.Chanh, the risk of bubbles is there, but grasping the very essence of things will help us take the initiative. Transparency is an important factor in controlling land prices. But it should be noted that as the market warms up, the volume of transactions is more noticeable. The amount of money circulated in the market will help the economy. The rules of the law should be clearer because there is always a law research force in the market to make a profit. The law does not prohibit a business person from seeking profits.
“For every real estate transaction, the law makes it very clear that the buyer and the seller must pay personal income tax and registration tax, and my point is that if a person makes a profit from taking advantage of the rules. The law, the law also loophole, and it is also the driving force for the state management agencies to perfect the Law, “said Mr.Chanh.
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