Illustrative image (Photo: VNA) Hanoi (VNS/VNA) - Real estate prices in 2021 are expected toincrease by 10 percent over the previous year, said Nguyen Van Dinh,deputy general secretary of the Vietnam Real Estate Association (VNREA).
Dinh told a forum held on January 6 that the COVID-19 pandemic affected thereal estate sector, causing weakening demand in the market. In early 2020,the market was frozen. The Government has taken many measures to untie thesector’s difficulties such as the promulgation of legal regulations forcondotel development. However, legal obstacles have hindered supply, creatingdouble difficulties for the market.
In the second half of the year, although there were two waves of the pandemic,the property market still showed strong growth as there were 60,000 new housingproducts supplied to the market, equivalent to 67.5 percent compared to 2019.The market has recorded impressive numbers as the absorption rate in HCM Cityreached over 80 percent, while prices in many localities increased. Tourismreal estate still increased strongly despite the pandemic.
“2021 will not have a risk of a virtual crisis or a bubble, but developsustainably. Infrastructure projects with good business opportunities willbecome attractive forces. Real estate investment will spread to mountainous areas.In addition, the bank interest rates that could be maintained at 2020's levelswill lead to stronger investment stimulus,” he added.
Finally, movements from the Government in 2021 would remove difficulties forthe market. Stronger FDI inflows would be the impetus in the real estate marketnext year.
Nguyen Tho Tuyen, chairman of BHS Group, said property prices wouldcontinue to rise in 2021.
“Real estate prices are a “marriage” between supply and demand. While thesupply is very scarce, foreign investors enter the market with billions ofdollars in deals in Hanoi and HCM City. In terms of demand, individualinvestors pouring money into the market even exceeded 30 per cent as mentionedin some studies,” he said.
In particular, at present, big investors in the market, mainly from Hanoi andHCM City, are in a state of capital preservation. They made big profits andwithdrew from Da Nang, Nha Trang and Phu Quoc markets before the marketplunged. Their capital is waiting to be invested.
Trinh Van Quyet, FLC Group’s chairman, said in the 2011-12 period, thereal estate market entered a period of oversupply. 2020 was a crisis of supplyshortage. However, in the last five months of last year, the marketwitnessed many positive signs.
Taking the example of FLC's project in Ha Long, all apartments withunfavourable locations out of 2,500 shophouse apartments were sold with pricesrising by 50 per cent. Inventory was completely liquidated.Investors think the worst is over.
However, experts all agreed that institutions are still the biggestbottleneck blocking the growth of the real estate market. Legal documents suchas the Land Law, Construction Law and Investment Law have not kept up withmarket development requirements.
Le Hoang Chau, chairman of HCM City Real Estate Association (HoREA), said legalbottlenecks should be removed for real estate development in Vietnam, becauseall firms want a fair, open and healthy business environment.
‘The year 2020 marked a strong change in the construction of the legal mechanismswhen the revised investment law and construction law were passed, solving manydifficulties,” he said.
“I think that the property market in 2021 will continue to develop because Vietnamhas controlled the COVID-19 pandemic. The Vietnamese economy also saw positivegrowth. Next year, the Ministry of Construction will focus on revising theHousing Law, and some decrees on old condominiums to facilitate businessesparticipating in the development of this type of housing. But we shouldalso pay attention to legal risk prevention and control in the financialsector, as well as corporate credit,” he added.
Dang Hung Vo, former deputy minister of Natural Resources and Environment,warned that if management is not good, it will cause bubbles in themarket. At this time, many real estate providers are in stock, but arewaiting for prices to increase in the next few years.
“In 2021, revising laws to fill gaps and get rid of overlapping rules isthe most important thing we need to do,” he added./.
Dinh told a forum held on January 6 that the COVID-19 pandemic affected thereal estate sector, causing weakening demand in the market. In early 2020,the market was frozen. The Government has taken many measures to untie thesector’s difficulties such as the promulgation of legal regulations forcondotel development. However, legal obstacles have hindered supply, creatingdouble difficulties for the market.
In the second half of the year, although there were two waves of the pandemic,the property market still showed strong growth as there were 60,000 new housingproducts supplied to the market, equivalent to 67.5 percent compared to 2019.The market has recorded impressive numbers as the absorption rate in HCM Cityreached over 80 percent, while prices in many localities increased. Tourismreal estate still increased strongly despite the pandemic.
“2021 will not have a risk of a virtual crisis or a bubble, but developsustainably. Infrastructure projects with good business opportunities willbecome attractive forces. Real estate investment will spread to mountainous areas.In addition, the bank interest rates that could be maintained at 2020's levelswill lead to stronger investment stimulus,” he added.
Finally, movements from the Government in 2021 would remove difficulties forthe market. Stronger FDI inflows would be the impetus in the real estate marketnext year.
Nguyen Tho Tuyen, chairman of BHS Group, said property prices wouldcontinue to rise in 2021.
“Real estate prices are a “marriage” between supply and demand. While thesupply is very scarce, foreign investors enter the market with billions ofdollars in deals in Hanoi and HCM City. In terms of demand, individualinvestors pouring money into the market even exceeded 30 per cent as mentionedin some studies,” he said.
In particular, at present, big investors in the market, mainly from Hanoi andHCM City, are in a state of capital preservation. They made big profits andwithdrew from Da Nang, Nha Trang and Phu Quoc markets before the marketplunged. Their capital is waiting to be invested.
Trinh Van Quyet, FLC Group’s chairman, said in the 2011-12 period, thereal estate market entered a period of oversupply. 2020 was a crisis of supplyshortage. However, in the last five months of last year, the marketwitnessed many positive signs.
Taking the example of FLC's project in Ha Long, all apartments withunfavourable locations out of 2,500 shophouse apartments were sold with pricesrising by 50 per cent. Inventory was completely liquidated.Investors think the worst is over.
However, experts all agreed that institutions are still the biggestbottleneck blocking the growth of the real estate market. Legal documents suchas the Land Law, Construction Law and Investment Law have not kept up withmarket development requirements.
Le Hoang Chau, chairman of HCM City Real Estate Association (HoREA), said legalbottlenecks should be removed for real estate development in Vietnam, becauseall firms want a fair, open and healthy business environment.
‘The year 2020 marked a strong change in the construction of the legal mechanismswhen the revised investment law and construction law were passed, solving manydifficulties,” he said.
“I think that the property market in 2021 will continue to develop because Vietnamhas controlled the COVID-19 pandemic. The Vietnamese economy also saw positivegrowth. Next year, the Ministry of Construction will focus on revising theHousing Law, and some decrees on old condominiums to facilitate businessesparticipating in the development of this type of housing. But we shouldalso pay attention to legal risk prevention and control in the financialsector, as well as corporate credit,” he added.
Dang Hung Vo, former deputy minister of Natural Resources and Environment,warned that if management is not good, it will cause bubbles in themarket. At this time, many real estate providers are in stock, but arewaiting for prices to increase in the next few years.
“In 2021, revising laws to fill gaps and get rid of overlapping rules isthe most important thing we need to do,” he added./.
VNA
