Inventory in Ho Chi Minh City fell sharply than Hanoi
According to the Department of Housing and Real Estate Market Management, compared with the end of 2015, 2016 and most recently in April 2017, the total value of real estate inventory fell by $999,782,608 (over 45%), $136,043,478 (about 10.09%) and $20,608,695.
Of these, the highest inventory value was concentrated in the ground segment with $574,043,478 – equivalent to 3,375,871sqm. Next is low-storey houses with 3,492 units, equivalent to $320,826,086; 3,325 apartments with the value of $210,086,956; commercial land 648,139sqm with $107,826,086.
“Although the inventory of real estate continues to fall, the pace of decline has slowed. Inventory is mainly land in projects far from the center without infrastructure, “said the Department of Housing Management and real estate market.
Comparison between the two major cities, the total inventory of real estate in Hanoi is still higher than Ho Chi Minh City. The value of real estate inventory in Hanoi as of the end of May 2017 was about $237,000, down only $1 million compared to the previous month. In Ho Chi Minh City, inventories were in stock at $225,348, down $4,347,826 compared with April 2017.
On the general assessment of the market, Nguyen Tran Nam, Chairman of the Vietnam Real Estate Association, said that the development of social housing has been stalled due to funding support as well as related policies have not been cleared or meet fit.
In the commercial segment, real estate development projects are still mainly credit and mobilization from the sale of houses in the future. Therefore, the strict management of credit with high-end housing is necessary, but the segment of affordable housing should have policies to form their own capital packages, especially for home buyers.
See more: Apartment for Sale in Ho Chi Minh City
“The share of general credit for real estate is still safe, but it only focuses on a number of large businesses, so it seems insecure. Adjusted to scatter risk, “Nam said.
In addition to credit from banks, many developed nations have raised funds for real estate through investment funds. It is safe to say that this fund is only 10% invested in an under-going project, and 90% is invested in a project that has been built for rent. This is a very good channel and should be carefully considered for use in Vietnam.
In addition, many real estate firms said that the supply-demand signal at this time could create new congestion, as the high-end apartment projects are now believed to be oversupply, in these flats are now available for most of the high-end segment.
The price of construction materials is rising quite high also is the risk that the price of real estate products is pushed up high reducing purchasing power … Therefore, when the project restarted, forcing investors to calculate High-cost price to pay money to the bank, just the cost of the name and not name when developing the project …
5 hints for dealing with bad debt, reducing inventory of real estate
HCMC Real Estate Association (HoREA) said that the handling of bad debts by credit institutions is still a hot issue now, especially in Ho Chi Minh City. Bad debt is closely related to real estate and real estate related sectors, bad debt is also the leading cause leading to many real estate projects “blanket” and inventory inactive. Property is also in the real estate credit processing. In particular, Ho Chi Minh City has about 500 projects have stopped deploying, with 500 projects this amount of inventory is very large.
Therefore, comments on the draft resolution of the bad debt resolution of the National Assembly, HoREA said that when dealing with bad debt proposal should consider five issues cover. It is about the subject matter (Article 2): Please add paragraph 3: “The relevant agencies, organizations, borrowers, borrowers, buyers in any project is a security asset.”
Second, in principle of dealing with bad debt (Article 3): Please remove the opening clause: “Organizing trading, dealing with bad debts comply with the following principles …”, because ” Bad debt “applies not only to the” Bad Debt Settlement Organization “, but should be applied to all stakeholders involved in the process of dealing with bad debt.
The Association agrees with the four principles of dealing with the bad debt of the draft but proposed to add the following principle: “5. Ensure the legitimate interests of borrowers, loan guarantors, buyers in the project that the investor has mortgaged to the credit institution.”
Thirdly, on bad debt (Article 4), the Association agrees with the plan 1. “Bad debts stipulated in this Resolution are debts specified in the Appendix on the determination of bad debts of this resolution. The National Assembly shall consider and amend the Appendix at the proposal of the Government. “4. The right seizes the security property (Article 7).
The Association endorses Clause 8 “The seizure of security property as provided for in this Article shall only be effected for security property not subject to dispute, not being subject to distract in criminal cases”. To ensure the legitimate interests of the borrower or borrower in the project the investor has mortgaged to the credit institution.
Finally, on the handling of security property as a real estate project (Article 10), the Association endorses the mechanism for dealing with collateral assets as real estate projects specified in Article 10, such as credit institutions. To use, foreign bank branches, organizations dealing in and dealing with bad debts, may transfer the secured assets of bad debts being real estate projects when satisfying the following conditions:
“Asian. The project has been approved by a competent state agency in accordance with the provisions of law, even in the absence of a certificate of land use right;
- The project does not dispute land use rights; not to be distracted to secure the execution of judgments or to execute administrative decisions of competent state agencies;
- There is no decision to withdraw the project, land recovery of the competent state authority.
In addition, HoREA also said that the transferee must meet the conditions of the transferee in accordance with the law on real estate business, inherit the rights and obligations of project investors and carry out procedures for continuing the project implementation according to the law provisions on investment and construction.
“With the promulgation of the mechanism for dealing with collateral assets as real estate projects in the draft resolution on handling bad debts of credit institutions approved by the National Assembly this time, will pave the way for Amendments to the Law on Real Estate Business in the coming time.
The association proposed that the National Assembly allow the widespread adoption of the real estate project transfer mechanism as mentioned above, which would help clear the market for M & A, clearing capital, and restarting the project. It is also a solution that actively contributes to the bad debt of credit institutions, whose owners are real estate enterprises using private capital and completely unrelated to the state budget.
This will help reduce inventory faster and more sustainable real estate, said Le Hoang Chau, chairman of HoREA.
You are reading the article “Real Estate Inventory Fell Sharply, But Worries Remained” in the section “Real Estate Market” on the website: https://realestatevietnam.com.vn/
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