Affordable housing will be scarce in Vietnam in the next 3-5 years.

24/11/2016   Viewed: 923
Increasingly expensive land prices in the city center area makes the development of real estate projects hard to implement affordable housing projects, without prior land preparation. Therefore, this housing segment is forecast future scarcity.
To many experts suggest, really high-end segment still own customers, secondary supply will increase sharply, particularly affordable housing segment will be scarce due to land investment funds will be difficult.

According to Le Anh Tuan, Director of Research company Dragon Capital fund manager, in the years to high-end housing segment will be plentiful. Through research, since the beginning of 2016 so far shows that sales prices in this segment with a slight decrease, but in the coming years there will be a steady growth in sale prices.
Nha gia re tai VN se khan hiem trong vong 3 5 nam toi

However, many experts said that in the future also for the exploitation of land for real estate investment in big cities like Hanoi and HCM City will be extremely tough, fierce competition. While the demand for affordable housing in these localities are always at a high level, so not cheap land in the next 3-5 years will be scarce this segment reached "alarming".

Neil MacGregor, CEO of Savills Vietnam, said that in big cities like Hanoi or HCM City land prices increasing pace of economic development and urbanization. The local government is spending a sizeable land bank in the central area of ​​investment planning infrastructure systems, so the land devoted to urban development has been constrained and tend to move out of suburban.

However, the cost of site clearance compensation and resettlement are making real estate investors always "cringe" when deciding which segments will grow at an attractive rate.

"That is why I insisted that the affordable housing segment in Vietnam in the next 3 years there will be scarcity, creating huge competition in the market. According to the last close, the last time many foreign investment funds targeting this segment, but not the investor also good hunting land, convenient transportation to development projects, "Mr Neil said.

According to the expert, the trend of housing investment in Vietnam over the past two years shows that investors are shifting to some of the county - the suburban district, bordering with neighboring localities shallow. Many housing projects affordable (around 1 billion) were present on the market, but so far is located in the city center, no traffic connection, convenient exterior zone is not investors should be buying power of the people is quite low.

According to Mr. Ngo Quang Phuc - Deputy CEO Him Lam Land, if now to buy land to build affordable housing prices is very difficult. The company has prepared the land for a long time, so the company is developing several condominium projects in this segment with a relatively favorable position, not too far from the city center.

Speaking on this issue, Mr. Nguyen Tran Nam - Chairman of Vietnam Real Estate Association, acknowledged that the system of real estate policy has begun to take effect in practice and gradually put into practice. Large enterprises still is the leading enterprise market trends.

But the real estate market still many potential risks such as the structure of goods on the market imbalance, lack of product and lower average prices. The development of social housing tend to slow down.

According to Nam, to do affordable housing, the investor needed a stronger support of the local authorities next to the existing policy. In particular, investors need is the cooperation with the government units in the implementation plan for site clearance and resettlement organizations.

Because since the allocation policy to be recognized as a clean land, the investor may take up to 2-4 years. Thus the market opportunity has passed and profitability is no longer.

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