Realty market poised for strong growth next year

Hanoi (VNA) - After posting a stable performance this year, the property market is poised for solid growth in 2017, driven by the improved economic situation, and developers more focused on market demands.

Experts, speaking at the annual conference entitled "Vietnam Real Estate Market: Overview and Forecast", organised by the property website batdongsan.com.vn on Saturday, said the market would see strong competition in product quality, but at reasonable prices.

Also, property expert Dang Hug Vo said that an over-heated market would not likely happen in the overall market or some segments next year, but demand would certainly be higher than this year.

Still, attention should be paid in the second half of this year, as there would be factors that could contribute to the formation of a market bubble, such as significant price increases and speculation.

Experts also said at the conference that resort, hospitality and housing properties would highlight the market in 2017, as demand for these two segments remains high.

“Developers are expected to move towards the market demand in 2017, with a focus on offering housing of good quality, but at reasonable prices,” Vo said, adding that the market was witnessing an alarming imbalance between supply and demand in the apartment segment.

In the high-end segment, demand accounted for just 20 percent of the market’s demand, while supply accounted for up to 80 percent of the market’s supply, and vice versa for the affordable housing segment, according to Vo.

Vo said the affordable housing supply would increase next year, as several property developers recently announced expansion into this segment, including Vingroup and Him Lam. However, supply would still be below demand next year, he added.

Meanwhile, a report from batdongsan.com.vn, which has 50 million page views per month and nearly 2 million regular users, found that the apartment segment received significant attention from the market, accounting for one-fourth of the total searches, said Nguyen Quoc Anh, Deputy General Director of the Dai Viet Group – the website’s owner.

Recommendations

Nguyen Manh Ha, former Director of the Housing and Real Estate Development Department, said property developers should not only rely on the Government’s incentives to develop affordable homes, but should actively develop what the market needed.

According to expert Can Van Luc, the Government should have measures to develop the capital market for the property market, which was still heavily dependent on bank loans.

Luc said the foundation and operation of the real estate investment trust (REIT) should be promoted, together with the security of property projects.

Luc urged the creation of a property market information centre to improve market transparency.-VNA