Real estate market is showing signs of difficulty when transactions are stopped, many projects have to reduce prices or restructure the selling price.
Reducing 7 million VND / sqm
According to the HCMC Real Estate Association, in the first six months of this year, the real estate market has shown signs of slowing down, potentially damaging factors. To date, many projects have begun to restructure prices.
For example, the Lucky Palace project in Phan Van Khoi Street, District 6 of Novaland Group is located in a crowded residential area, concentrating the largest wholesale market of Ho Chi Minh City but is reducing the selling price of VND 7 million / sqm… Previously, Lucky Palace sold at an average price of about VND 34 million/sqm. Currently, Novaland has reduced the average selling price to about VND 27 million/sqm. The form of sale discount is not direct but through the promotion, gift package interior …
Specifically, Novaland will donate interior decoration package worth VND 220 million for customers who buy apartments less than 90 sqm. Customers who buy larger apartments will be offered up to VND 340 million. Customers who have temporary residence book, registered or working in districts 5, 6, 10, 11, Tan Binh, Tan Phu, Binh Tan will receive a 1% discount on the value of the apartment.
In addition, customers will receive a 5% discount when purchasing a commercial plot. On the occasion of Novaland’s 24th anniversary, homebuyers have the opportunity to receive 1 kg of gold when signing contracts.
Similarly, the Viva Riverside project located in front of Vo Van Kiet, District 6 is also rescheduled by Vietcomreal. Accordingly, Vietcomreal has signed with the distribution unit with the price of VND21 million/sqm, instead of the price of about VND28 million/sqm as the previous sale. Thus, this price reduced about 20% compared with the opening and 30% cheaper than the price of projects in the same area.
Heaven Riverview project located at Truong Dinh Hoi street, District 8 also decreased VND3 million/ sqm. According to brokerage staff of Gia Viet Investment, previously this project cost VND17 million/sqm. Currently, Heaven Riverview is only VND 14 million / sqm.
District 2 is the focal point of the real estate market in Ho Chi Minh City. Despite the good location, the price is quite attractive but some projects have difficulty in selling. The cause is that the road Dong Van Cong into the Cat Lai urban area often stuck with cars, every day to receive hundreds of container cars cause residents feel insecure.
Therefore, although located in the heart of the real estate of the east of HCMC, the offer price of the project here is lower than the projects in the same area. “Because the road leading to the project is constantly jammed car, causing the project to lose value. Investors have to reduce selling prices, increase utility but liquidity is still very slow, “- said Le Hong Sy, the broker in the east, said.
Customers are knowledgeable about the market
According to Nguyen Thi Phuoc, general director of Vietcomreal, the Viva Riverside project does not have to reduce the selling price but rather restructure the selling price. Previously, Vietcomrael sold VND 28 million/ sqm will hand over the finishing house. At the moment, when selling at VND21 million / sqm, Vietcomreal will deliver the crude apartments to customers so that they can customize their designs and financial possibilities.
“Vetcomreal just restructured its price, not its quality. The project is built to ensure the best quality and is constructed by Hoa Binh construction contractor. Viva Riverside is also sponsored by Vietcombank, guaranteeing customers to buy apartments, thus ensuring peace and quality of construction.
In the coming time, Vietcombank will finance the projects of Vietcomreal with the total amount up to VND 1,500 billion. For the Viva Riverside project, Vietcombank will invest about 800 billion dongs. In addition, buyers of Viva Riverside apartments are funded up to 70% of the value of apartments, with interest rates of 0% until the house.
Phuoc said that the Viva Riverside project has a total investment of nearly VND1 trillion, to be built on nearly 11,000 square meters of land. In particular, the investor only gives the construction area of nearly 7,500 sqm with three fronts of Vo Van Kiet avenue, Gia Phu and 61, the rest used for utilities, green areas and the infrastructure. The project includes 567 apartments with an area of 50-106 sqm and the investor will hand over the house in mid-2018.
In addition to Viva Riverside, Vietcomreal is also implementing a series of projects in districts 4, 5, 8 with an area of about 300,000 sqm, the total investment of hundreds of millions of dollars. These projects have been funded by Vietcombank and a number of banks and investment funds.
However, the implementation plan for these projects will also change. Instead of focusing on luxury apartments as before, some projects will be converted to affordable apartments. As the project in District 8, the proposed price is about more than VND1 billion per apartment. It is expected that these projects will be implemented in the period from now to 2020.
Le Hoang Chau, Chairman of HCMC Real Estate Association, said that when the market freezes, businesses often seek to sell losses to cut losses. At present, the market has not reached that level but now also have the owners reduce profit by reducing selling price to sell goods, create liquidity.
“From now until the end of the year and especially in 2017, the real estate market will be more difficult. Therefore, businesses need to focus on medium-sized commercial housing, medium-sized and affordable apartments for the majority of people, “Chau said.
Meanwhile, Ms. Duong Thuy Dung, Director of Research and Consulting Company CBRE Vietnam, said in a market where buyers are more knowledgeable and more competitive products to achieve results. Good business owners will definitely have to make a difference to their products from design, quality, payment methods to the sales and marketing team.
“Companies that do not have time to adapt when the market changes will face many difficulties in the coming time,” Dung said.
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