Central Vietnam Real Estate News Summary
We will be focusing on issues related to Da Nang and Hoi An, while also looking at national news and their possible impact on Central Vietnam’s property market.
You will find a summary, a link to the source as well as HOUSEINDANANG’s take on the article.
We believe that local knowledge is the key to making the best possible decision and that’s what we offer to all our clients.
1. The economy of Vietnam in Q1/2022: Continue to recover despite challenges.
- The BIDV Training and Research Institute believes that Vietnam’s economy will continue to recover but still face 4 difficulties and challenges that can grow 5.5 – 6%.Socio-economic activities, Vietnam’s economy recovered more and more clearly with 8 bright spots:
Firstly, the epidemic continued to be controlled and changed positively, and the Government drastically restored socio-economic activities.
Second, GDP growth in the first quarter of 2022 is positive, estimated at 5.03%.
- Thirdly, imports and export grew positively, the trade balance was in surplus.Fourth, foreign direct investment grew positively.Fifth, state budget revenue maintains a positive momentum but is unsustainable and development investment spending is still slow.
Sixth, basic interest rates and exchange rates are stable.
Seventh, business activities flourished.
- Eighth, tourism activity recovered positively.Importance: Those positive signals in the economy are the good news to the real estate market in general with more enquires about the property.
2. Why Housing Market is starting to heat up
Currently, the real estate fever is not only concentrated in a few large cities such as Hanoi and Ho Chi Minh City. In Ho Chi Minh City, it has spread all over the country, creeping into the countryside and mountainous areas.
One of the reasons why the land fever is showing signs of spreading strongly is because the investment money is still very large, and the trend of investors and individuals rushing to buy land takes place in a hurry at normal times. Recently, the bad effects of the Covid-19 pandemic are gradually receding.Stemming from the fear of inflation, many people look to real estate to make a shelter.
Along with the Government promoting public investment, localities with changes in planning and infrastructure have recorded a sharp increase in interest in land search.
The big reason for the strong increase in the real estate fever spreading across the three regions is due to the news of investment in large projects.
One of the reasons for the widespread land fever is that in the past two years, Vietnam’s general economy, although still greatly affected by the Covid-19 epidemic, still has had a significant impact on economic growth. In addition, much new planning information has been announced. In areas where planning information is expected to appear, investors will pour in, whereby land prices are pushed up due to rapid buying and selling.
The importance: the land fever mainly comes from the psychological factor of wanting to stay ahead of the market, they want to focus on forecast areas that are likely to develop well. However, there are many potential investment projects that are unclear and uncertain that investors have jumped into. As a result, creating a virtual land fever, many investors were trapped.
3. It is difficult to control the price increase of real estate in the coming time
- The increase in real estate prices is forecasted to be difficult to stop in the context of escalating development costs along with explosive housing investment demand in many markets.
Real estate has a correlation with inflation, when inflation is high, real estate will also increase in price and is considered by investors as a safe haven. Inflation increases, currency increasingly depreciates, and investors will tend to assets with accumulated value such as land, or assets with long-term growth value.In addition, with the apartment segment, the sharp increase in the price of input materials forced investors to increase the selling price to ensure profits, not to mention a series of other factors such as increased labor costs, and administrative procedures. prolonged licensing… also affects the cost of the product.
Why it is important: Investors need to have a methodical strategy and be prepared for fluctuations in both price and liquidity of the market. In addition, investors should also calculate a prudent investment strategy, avoid following the psychology of the crowd or set high expectations, running after land fever will easily get bogged down and buried capital, virtual profits.
- Source:https://batdongsan.com.vn/tin-thi-truong/kho-kim-ham-da-tang-gia-cua-bat-dong-san-thoi-gian-toi-ar108761
- 4. Is the real estate market changing?
Investors calculate the value at a reasonable level. While people with real needs will not buy products that are overpriced, leading to poor absorption.
Real estate prices are increasing in most segments, while liquidity has not increased commensurately, which is considered a “variable” of the real estate market in early 2022.
- Meanwhile, the land price winning the auction in most localities is very high. In addition, inflation may rise higher, banks are expected to continue to tighten real estate credit… are the reasons that push up housing prices. The high-end housing and land plot segments will still have good appeal as they are better suited to the demand for holding properties, so prices for these segments will continue to increase. For affordable and mid-end apartment segments, prices will increase more slowly to maintain absorption.Psychological “variable” is also one of the challenges for the real estate market. Currently, the economy is facing many difficulties due to the prolonged epidemic and its impact on the general situation of the world.
- The recent conflict between Russia and Ukraine has also affected oil prices worldwide and seriously affected the market’s recovery. Besides, inflationary pressure is high in many countries. Vietnam is not an exception to these difficulties. In addition, the State Bank has tightened credit on real estate recently. It is these factors that, according to experts, are affecting the psychology of investors in the market.Source:https://cafef.vn/thi-truong-bat-dong-san-dang-co-bien-20220418083327335.chn
5. The attraction of Danang coastal real estate
- Da Nang coastal real estate products attract investors after the economy is showing signs of recovery and tourism is open.
- According to experts, high-class coastal apartments are still an attractive investment and resort model for investors because the living needs of people are increasingly improved. The coastal apartments with spacious views, wind, and waves still create a great attraction.
- Vietnam’s resort real estate market report said that in the first quarter of the year, many types of coastal properties restarted with more abundant supply and increased selling prices compared to 2021. In the first quarter, the selling prices of resort villas, townhouses, and beach shophouses increased by 10-17% and condotel prices increased by 5-8% compared to last year.
Real estate has a correlation with inflation, when inflation is high, real estate will also increase in price and is considered by investors as a safe haven. Inflation increases, currency increasingly depreciates, and investors will tend to assets with accumulated value such as land, or assets with long-term growth value.
Meanwhile, the land price winning the auction in most localities is very high. In addition, inflation may rise higher, banks are expected to continue to tighten real estate credit… are the reasons that push up housing prices. The high-end housing and land plot segments will still have good appeal as they are better suited to the demand for holding properties, so prices for these segments will continue to increase. For affordable and mid-end apartment segments, prices will increase more slowly to maintain absorption.