The Real Estate Market In Hanoi Is Bleak

Retail space rents declined, hotel supply declined 5.2%, transaction volume and apartment supply slowed down … is the picture of the real estate market in Hanoi at the moment.

On October 12, Savills Vietnam Co., Ltd. released a report on the real estate market in the third quarter of 2016 in Hanoi. Accordingly, in the third quarter, Hanoi has about 1.2 million square meters of retail space. This represents an increase of 3% over the second quarter and 23% over the same period in 2015.

The supply increased but the ground floor rental fell in all types of retail. The occupancy rate increased 1.9 percent from the second quarter but fell 2.7 percent from the same period in 2015. The departmental occupancy rate was down 1.3 percent from the previous quarter.

“The strong competition between domestic and foreign retailers has forced some projects to continue to renovate and restructure retail space,” Savills said.

In the third quarter, only villas and adjacent houses in Hanoi were growing.

The gloomy also took place in the apartment segment for sale. In the third quarter, the total primary stock was 17,000 units, down 2% from the second quarter. There were 13 open and 10 new open plan projects sold 5,700 apartments to the market, down 6% compared to the second quarter.

In the third quarter, there were about 5,700 units sold, down 6% from the previous quarter and down 15% from 2015. Grade B recorded the highest sales in six consecutive quarters, accounting for 51% of total units sold.

Similarly, the hotel market supply in Hanoi also decreased 5.2% compared with the second quarter. Capacity decreased 2% qoq. However, room rates increased 4% compared to the second quarter and 12% over the previous year.

Meanwhile, the supply of offices for lease and serviced apartments remained stable. Total office space for lease in this quarter reached about 31,000 sqm. Of which, B is the market leader with approximately 18,000 m2. Followed by Grade A with approximately 8,500 sqm and Grade C with approximately 4,300 sqm.

According to Savills Vietnam, in the fourth quarter will have more than 800 villas and houses adjacent to the market.

In the third quarter, only villas and townhouses in Hanoi were growing. Total supply of this segment reached 33,500 units, up 3% compared to the second quarter and 10% compared to 2015. Ha Dong continues to lead the supply with 26% market share.

>>>Update on new information on the real estate news in Vietnam here: Vietnam real estate news

According to Savills Vietnam, in the fourth quarter will have more than 800 villas and houses adjacent to the market. In the segment of apartments for sale, more than 13,000 units will enter the market. Most of them are Grade B apartments from Tu Liem, Thanh Xuan, Tay Ho and Hai Ba Trung.

Expected, the fourth quarter also put into use an office leasing project, providing the market about 11,300 sqm. At the same time there will be two new serviced apartment projects with 747 apartments.

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