The COVID-19 pandemic significantly affects the real estate market but many expect a market recovery when the virus is put under control. (Photo: baodautu.vn) Su Ngoc Khuong, senior manager at real estate consultancy firm Savills Vietnam, said theoutbreak of the COVID-19 pandemic in the second quarter of this yearsignificantly affected socio-economic development. The real estate market sawdeclines in purchasing power and investors were more cautious.
Statistics from Vietnam’s largest property portal batdongsan.com.vn showed thatafter reaching a peak in March, the level of interest in the real estate marketshowed signs of decreasing.
Real estate searches on the portal in April dropped by nearly 18 percentagainst March with searches for land down by nearly 21 percent and apartmentsby 17 percent. Interest continued to decline in May with searches forresidential land decreasing by 19 percent.
Notably, prices of apartments saw an increase of about 3 percent against thesame period last year.
Deputy Director of the Vietnam Association of Realtors Nguyen Van Dinh said theshortage of supply was a major reason for the increase in the apartment pricesin the first half of this year.
According to Matthew Powell, director of Savills Hanoi, the COVID-19 pandemicwould continue to impact the real estate market, causing uneven developmentbetween different localities, different market segments and different projects.
It was important that the virus be put under control together with thevaccination programme, he said, adding that when the virus was successfullycontained, investment would flow into the economy.
He, however, urged individual investors to study the information of propertyprojects, planning and infrastructure development carefully before makingdecisions.
Mai Duc Toan from the Construction and Material Trading Group said not only thereal estate market but other sectors were holding their breath for the updateson the pandemic.
“The market is still difficult to predict. Local land fever might occur. If thepandemic is successfully put under control, the market would bounce back in thesecond half of this year,” Toan said.
He added the real estate market development largely depended on the pandemicand pointed out that in the three previous outbreaks, prices were seen toincrease in a number of segments, even forming large-scale land price fever atthe beginning months of this year.
Ngo Quang Phuc, general director of the Phu Dong Group, said the real estatemarket had large potential for development and the outbreak would only have ashort-term impact.
Phuc said that the market was expected to see robust development, providing thelegal problems of real estate projects were tackled properly.
Director of Dai Phuc Land Nguyen Thi Thanh Huong said from the beginning of2020 to date, despite virus outbreaks, the real estate market basically kept asolid foundation. There were not significant price drops or sell-offs but themarket often saw stronger transactions and increases in prices.
According to Khuong, the property market would not see any breakthroughdevelopment because the Vietnamese economy was still struggling with theimpacts of the COVID-19 pandemic.
Most transactions recently were from long-term investors who had idle money topour into the real estate market, he said.
In the scenario of market recovery, the housing segment would be the mostrobust, driven by high demand, Khuong said, adding that while the pandemicaffected incomes, housing demand would focus more on affordable homes.
He added that the resort and tourism property market would continue to sufferand retail property would struggle to compete with rising online platforms. Theinterest of investors in industrial property remained high but investment inthis segment would not be as good as expected because of travel restrictions./.
VNA
