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Investing In Real Estate, Identifying New Trends

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Although HCM City’s real estate market from early 2017 has shown signs of slowing down, it may be just a pause for momentum.

In the face of increasing demand for housing, the infrastructure is increasingly being improved, forecasted to remain large market development.

Select ground or apartment?

At the seminar “tendency to buy real estate in 2017” held last weekend in Ho Chi Minh City, experts said that the market movements from the beginning of 2017 to the present there is a great divide between the market segment and the region. While the apartment market is clearly showing signs of slowdown, the land market is gaining momentum.

According to Dinh The Hien, a financial expert, real estate, real estate is still a channel to attract individual investors in 2017 but it will sharply segment, make the choice based on the needs and financial capacity of investors. In particular, the market will not have a clear trend. The opportunity will come for each specific project, based on the location, the owner, and the appropriate product. Of these, medium-high-end apartments in good locations are still the right choice for those with financial capacity.

With apartment market, according to Mr. Hien, cheap apartments are still segmenting with great demand, but if the infrastructure location is too poor. It will be very difficult to profit investors, but luxury apartments will be more difficult because the market is showing more supply than demand.

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Land-based projects proved to have many advantages from the beginning of the year.

Meanwhile, with the land segment, townhouses, although the last time has been strong development forecasting the possibility of upcoming will continue to grow because this segment not only attracts people with real needs but also investors due to the influence of consumer psychology habits.

However, the development of this segment will mainly focus on projects with real needs, well connected with infrastructure, utilities. With the product line lack of these factors, pushed prices by speculators, will certainly burst bubbles.

“Overall, 2017 is a year of real estate market moving more by substance than quantity,” Hien stressed.

According to Tran Khanh Quang, general director of Viet An Hoa Real Estate Investment Consultant Company, in 2017 products offered to sell will be less, low price apartments are under USD $ 65,000 per unit is still the preferred choice, USD $ 150,000 homeowners are still attracting customers, the land of the West and South City if the investment will be profitable.

According to Quang, tightening control over real estate lending by banks will make investors more considerate in developing new projects. In contrast with banks in the previous year, foreign investment funds are interested in pouring capital into real estate in Vietnam at this time.

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Current house prices in Vietnam are still lower than other countries

It is forecasted to slow down compared to 2016 and by the year 2020 there will be a major adjustment to address the supply-demand phase gap is tending to deviate toward high-end real estate but in 2017 the opportunity for the market is still great.

Le Hoang Chau, Chairman of the HCM City Real Estate Association, said that looking at the performance of the market from the beginning of the year shows that the market has a big divide between sectors and segments.

Regarding the regional divide, if Saigon South previously seemed to be the center of attention, recently demand has tilted to the East and West. This has many causes, but the main reason comes from the development story of the infrastructure. Because this has become a rule, where there is a strong infrastructure will lead to an increase in demand.

“Another development of the market from the beginning of the year, market demand seems to be studying the land segment. This fact is also creating certain risks for the market because this segment is strongly attracted speculative capital, especially some incomplete infrastructure, lack of utility services but investors are ready to press ahead planning, push prices up”, Chau said.

Chau also recommends, for people with real needs for housing, should not run the market trend. It requires the consciousness, choice of real estate products in accordance with the needs, legal safety. In which the choice to buy apartments is still a good solution for living needs, not necessarily land, and townhouse.

Large territory, but deviated supply and demand phase

According to experts, the real estate market in the South, especially with Ho Chi Minh City, the demand for housing is still very large. The population is constantly increasing and urbanization speed is quite strong in most districts. In addition, the connection infrastructure is increasingly perfect … are factors to confirm the growth of the market is still very large. However, the big story of the market today is the phase difference in supply and demand.

According to Nguyen Tri Hieu, an economist, Vietnam’s average income is $ 2,000 per capita per year, of which Hanoi is USD 4,000 per person per year and HCM City is 6,000 USD per person per year. So in Ho Chi Minh City where people have an average income of 10 million per person per month, is it enough to buy luxury apartments? Therefore, Hieu said that the State should also be concerned about the supply-demand phase shift for the apartment market.

Speaking about the issuance of underwriting to investors in the sale and lease of a housing to be formed in the future, Dr. Nguyen Tri Hieu said that in the US no real estate guarantee formed in the future.

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Consumers in Vietnam are being exploited because there are cases of money disability brought about by the weak capacity of the investor when these owners defaulted, not implemented damage to consumers.

“Real estate investors in the United States are not allowed out to call on people to contribute. And investors can only borrow the bank and then build when completed, customers just come to buy. If consumers want to buy since they have not been formed, the owner must put the money into a separate ‘warehouse’. By the time the project is completed, the investor will be able to take the money back to the bank”, Hieu said.

According to Hieu, consumers in Vietnam are being abused because there are cases of money loss Due to the weak capacity of the owner when these bosses are insolvent, cannot deploy, causing damage to consumers.

Therefore, the buyer should pay attention to the issues related to the projects under guarantee and the investor must notify customers about the bank guarantee project. Customers must review the purchase of future homes if the developer does not provide documentation of the project’s guarantee.

Chau said that looking back at the period from 2007 to 2010 is the fever of the real estate market, but it is the development phase “bubble” to the consequences difficult to solve later. As from 2013, the market enters the stage of professional development, businesses have a large adjustment, rebalancing products in the real estate market have the phase difference in supply and demand.

According to Chau, current house prices in Vietnam are still lower than many countries. Meanwhile, Vietnam’s infrastructure and economy are developing. Demand for property is still very large and tends to increase.

Notably, in addition to investment channels such as gold, securities, savings deposits, real estate investment is still the preferred choice because bank deposits are not attractive in terms of assets. Specifically, gold is in downward trend; Hard exchange rate increased by more than 5%; the stock is risky, hard to attract new people.

“Overall, the development of the real estate market in the south is still great. The problem is that this is a market will grow more depth. Enterprises that want to develop sustainably have to choose the right product line, the project must be invested properly and the enterprises with lack of professionalism will surely be eliminated by the market”, Chau said.

According to the analysis of most expe

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Vietnam’s infrastructure and economy are growing, the demand for property is still very large and tends to increase.

rts, the real estate market from here until the end of the year and the next year, there is likely to be a correction phase. However, basically, this is still a very attractive market. This appeal is not only for domestic investors but also for foreign investors. This is evidenced by the recent time, capital from foreign investors are constantly poured into the real estate field with increasing capacity.

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