How will the real estate segments evolve in the third quarter?
VietReader 12-07-2020, 10:25

Apartments: This is a segment with a quite good number of supply in the market than other segments. Apart from Ho Chi Minh City, apartment projects in neighboring provinces such as Binh Duong and Dong Nai also witnessed new supply in the quarter. According to DKRA Vietnam, in the coming time, the apartment segment may maintain a stable level, in which the supply is mainly in the mid-end segment. Prices tend to go up but not much change, trading is also stable.

The representative of this unit forecasted that the secondary transactions maintained relatively low liquidity and focused mainly on projects that were handed over. However, there was no widespread secondary price cut and only a few financially weak investors accepted to cut losses.

How will the real estate segments evolve in the third quarter?

According to the forecast of this unit, in the third quarter, the supply may increase slightly compared to the second quarter, fluctuating between 4,000 – 5,000 units. The overall demand of the market can maintain the trend but not surge. In particular, the East and the South still account for a large proportion of the supply. Grade A and B apartments continue to lead the market while supply of Grade C apartments remains scarce.

Land plot: This segment is forecast to continue to be in short supply in the next quarters. The price recorded will be less volatile due to the impact of the epidemic, purchasing power is still slow.

According to brokers, from now until the end of the year, the situation will not see a surge in both supply and transaction. The current purchasing power is still stalled because the buyers’ psychology is still worried about the outbreak of the disease again. They still keep the money to wait for a better market.

However, this is also the time when many investors with thick capital still collect land plots in some areas with good information on transport infrastructure to buy and wait for profit.

According to Mr. Nguyen Hoang, Director of DKRA Vietnam R&D Department, although land transactions and supply have decreased compared to the same period last year, this is still a favorite segment of investors. However, with land in Ho Chi Minh City, the price level has risen too high, so the demand tends to shift strongly to the surrounding provinces around the city.

Villa and townhouse segment: According to JLL Vietnam, in this segment, supply is forecast to continue to be scarce in the coming period. Although the transaction will not mutate, investors are still confident to increase selling prices.

According to DKRA, in the third quarter of the townhouse segment, villas may decrease slightly compared to the second quarter. The East continues to lead the market in the supply of this segment. The market demand can maintain the recovering trend from the end of the second quarter but it is unlikely that there will be a sudden increase.

Resort real estate: This type is expected to face difficulties in the next quarter because the demand has not yet fully recovered.

However, this type is expected to recover when international visitors return to tourism. Resort real estate is forecasted to still have a lot of potential to exploit, not only in traditional tourism markets but real estate projects tend to focus strongly on emerging markets.

Mr. Pham Lam, CEO of DKRA Vietnam said that with the current real estate market, we should eliminate the thinking that whenever the fever is “jumping in”, we should look at the added value of the real estate segment in the future.

Talking about the resort real estate segment, Mr. Lam said that obviously the liquidity of this segment is reduced but I think this market is like a running water. The tourism strategy has not changed, the goal is to welcome 20 million international visitors by 2025. Thus, this is the right time to buy investment, choose good products. When the market gets better, there are many choices.

Mr. Lam said that it is undeniable that the real estate market is slowing down compared to the previous time due to the impact of many factors at the same time but in general, the real estate picture is quite attractive and positive in the segments from apartments, land plots, townhouses to resort real estate.