The country’s property market is expected to slow down with prices starting to drop by the end of this year and hitting the bottom by mid-2021. (Photo: VNA) Hanoi (VNS/VNA) - The Vietnamese property market is expected to slowdown, with prices starting to drop by the end of this year and hitting thebottom by mid-2021, creating opportunities for home buyers sitting on cash,experts have forecast.
“Housingprices will begin to plummet by the end of this year and bottom out by mid-2021when the [COVID-19] pandemic has impacted almost every sector, especially thehousing market,” Tran Khanh Quang, general director of Viet An Hoa Company,said.
Sincethe second wave of the pandemic began late last month, investors’ confidencehas once again weakened as property sales dived and incomes were hit hard.
“The financial market has faced fluctuationssince the beginning of the year when the outbreak started,” he said, addingthat a large amount of long-term cash flow is still waiting for good prices tobuy.
“Fromthe end of the year to the first half of 2021 will be an opportunity for homebuyers. The most affected segment is the higher end.”
Withthe real estate market remaining uncertain in the first half and probablycontinuing to be so for the rest of the year the commercial housingsegment in HCM City faces a slump, according to Savills Vietnam.
Theoutbreak has forced people to tighten their purse strings due to loss ofincome, which would also affect housing demand.
Housingdevelopment has also been facing a prolonged legal and licensing barrier, hittingbuyers’ confidence.
Theresurgence of COVID-19 caused the online real estate market to slow down by 7percent in July as measured by users’ likes and number of searches, accordingto a report from popular property website Batdongsan.
Theamount of news posted and the level of interest in the market has seen adecrease since late-July due to the return of the deadly virus, it reports.
Interestlevels in online real estate floors in provinces recorded an average drop of 10percent.
Thewebsite’s internet consumer research data also show that in Da Nang, the new epidemicepicentre, it dropped by 20 percent, the highest rate in the country.
LeHoang Chau, chairman of the HCM City Real Estate Association (HoREA), said themarket would continue to have high demand for affordable apartments while thesupply in this segment is limited.
“Thereis need for more investment in the affordable housing segment. Thissegment has high demand and also high liquidity".
Demandfrom foreigners was also increasing, said Nguyen Duc Them, project salesmanager at Savills.
Accordingto HoREA's report, foreigners now own around 16,000 apartments, or 2 percent ofthe total supply, and this has not affected locals’ opportunity to buy housing.
Since2015 big-name developers have sold 12,335 units to foreigners, 81 percent ofthem in HCM City.
Mostpeople coming from Europe, North America, Australia, and Japan prefer to rentwhen they come to work in Vietnam, while those from mainland China, theRepublic of Korea, Taiwan, Hong Kong, and Singapore prefer buying, it added./.
