HCM City property market sluggish

A lull in the HCM City real estate market is pushing developers to offer promotions to bring back buyers.— Photo nguoiduatin.vn A lull in the HCM City real estate market is pushing developers to offer promotions to bring back buyers. Tuoitre.vn quoted an unnamed developer as saying that in the last two months it has been difficult to sell apartments. His project in District 6 has 450 units but only 140 have been sold since the beginning of this year. His company had planned to begin a new project in the second quarter of this year, but it has been put on hold as a result of the market slowdown. All his employees have been put on the job of selling apartments at old projects, he said. Pham Lan, general director of Danh Khoi A Chau Company, said the land segment has slumped since last month since customers have become apprehensive after prices skyrocketed in districts 2 and 9. Besides, many expect the market to remain steady until the end of the year and so have put off their buying plans, he added. Le Hoang Chau, chairman of the HCM City Real Estate Association, said this year developers had been selling their old projects and few new ones have come to the market. Land transactions are strongly down since Lunar New Year in late January, he added. Dao Xuan Tung, head of the Can Gio Notary Office, said the…... [read more]

A lull in the HCM City real estate market is pushing developers to offer promotions to bring back buyers. A lull in the HCM City real estate market is pushing developers to offer promotions to bring back buyers.- Photo nguoiduatin.vn Tuoitre.vn quoted an unnamed developer as saying that in the last two months it has been difficult to sell apartments. His project in District 6 has 450 units but only 140 have been sold since the beginning of this year. His company had planned to begin a new project in the second quarter of this year, but it has been put on hold as a result of the market slowdown. All his employees have been put on the job of selling apartments at old projects, he said. Pham Lan, general director of Danh Khoi A Chau Company, said the land segment has slumped since last month since customers have become apprehensive after prices skyrocketed in districts 2 and 9. Besides, many expect the market to remain steady until the end of the year and so have put off their buying plans, he added. Le Hoang Chau, chairman of the HCM City Real Estate Association, said this year developers had been selling their old projects and few new ones have come to the market. Land transactions are strongly down since Lunar New Year in late January, he added. Dao Xuan Tung,…... [read more]

Many businesses operating in IPs and EPZs have benefited from tax preferences, simple investment procedures and support in terms of workforce and other resources. In Hanoi, the number of projects in IPs and EPZs increased from 155, with a total investment capital of US$1.55 billion in 1996-2000 to 1,377 worth US$ 8.08 billion in 2001-2005. From 2006-2010, Hanoi saw an impressive growth with 2,309 new FDI projects capitalized at US$42 billion. Up to September last year, more than 3,841 FDI projects and 4,617 domestic projects in IPs and EPZs zones throughout the country got off the ground with a total disbursement of more than US$17.6 billion. Marketing and Business Development Director of Colliers International Vietnam, Dane Moodie, said the economic downturn in 2007-2009 appeared to have little impact on northern IPs where the average rental fees rose slowly from US$41.3/m2 in 2008 to US$58/m2 in 2010. Northern key economic zones, including Hanoi, Bac Ninh, Hai Duong, Hai Phong and Vinh Phuc will continue to lure more investors while Thai Nguyen and Hung Yen are becoming more attractive with their good infrastructure facilities, the strong economy and favourable strategic positions near seaports, airports and areas sharing the border with China. According to Colliers International Vietnam, Vinh Phuc and Bac Ninh have the highest rates of land rental. However, there are certain problems arising from policy, that need to be solved such as a shortage of skilled workers, pay rise, infrastructure development, complex legal and taxation frameworks. For this reason, investors need…... [read more]

BR-VT with new investment approach The southern province of Ba Ria-Vung Tau has awarded the investment certificates for the first four projects of the year with total capital pledges of a slight VND29 trillion. The province was known as a leading area in foreign direct investment (FDI) attraction in the country in previous years but this year there is no FDI project among the four licensed. The Saigon Times Daily spoke with Ho Van Nien, the province’s vice chairman, to get answers to the matter. The Saigon Times Daily: The Investment Day 2012 held by the province early this year saw no FDI projects licensed though FDI was a major source of capital in the province in the past. What do you comment? - Ho Van Nien: There were actually some FDI projects but their investors did not complete the procedures on time. Ba Ria-Vung Tau used to be an easygoing province in the project approval process. It often chose the beginning of a year to license as many projects as possible to expect good luck in the entire year. Therefore, we often accelerated the approval process to have the first projects licensed at the start of year. Of course, we still strictly adhered to the investment assessment and approval regulations. It was a regret that a Japanese company did not get the investment certificate for its project in the Investment Day event. Unlike in previous years, the Investment Day 2012 attracted a lot of Japanese investors. Almost all Japanese…... [read more]

More supply eases residential segment By Dinh Dung in HCMC Individual buyers in the capital city of Hanoi repeated what the Saigonese did around two years ago as many flocked to a condo project in the early morning, jostling each other to deposit for apartments. Local media reported hundreds of Hanoians gathered at Nam Cuong Corporation to deposit some VND50 million and the right to buy an apartment. It is the expected profit margin that lured the investors who anticipate a certain difference from reselling their buying rights. This makes the northern property market a little busy. Savills Vietnam, a market research company, reported that in HCMC, the total apartment for sale supply during the first nine months of this year in the primary market, where buyers can buy apartments directly from developers, was around 9,500. Of the primary supply, there were about 16 newly launched projects in the nine months with about 4,850 apartments. According to Savills' new classification system for apartments for sale, the total primary supply in the first nine months was broken down into three grades, in which Grade A was around 875 apartments, Grade B around 2,230 and Grade C around 6,460. Around 6,300 apartments were sold in the primary market in HCMC in the first three quarters of this year. Neil Mac Gregor, Savills' deputy managing director, notes the market is seeing the greatest activity in the low- to mid-end categories where there remains significant undersupply. Grade C apartments are mainly developed by local…... [read more]

By Dinh Dung in HCMC The Ministry of Construction’s Circular 16/2010/TT-BXD providing guidelines for Government Decree 71/2010/ND-CP, which in turn clarifies the housing law, has come into force for several weeks. The market does need some time to adapt to any changes brought by new rules. This time the new circular and decree have sent a shockwave to the property market and of course it will take the market time to familiarize itself with the unwelcome adjustment. The period of adaptation, however, will be longer than normal as the reality shows that the new regulations can apply well to new projects while they are a pain in the neck for old projects and worse, a nightmare for secondary investors who own land lots in property projects which had been developed before the new rules came out. Though the regulations do not apply retrospectively, they have impacted on the secondary market, especially the land market segment where individual investors cannot resell their land as authorities are awaiting more guidelines from the Ministry of Construction. The new regulations allow housing developers to start selling their products upon completion of the foundations of their projects. For the first time they permit customers to sign with developers a commercial purchase contract for a housing unit that will be built in the future. This rule is seen as an impetus for housing projects; developers can mobilize funds from individual investors to finance their projects. On the part of the buyer, they can get apartments at…... [read more]

FDI seen worse than expected By Quoc Hung - The Saigon Times Daily HCMC – Vietnam has suffered a poor showing this year with foreign direct investment (FDI) approvals seen far lower than the year’s target of US$22-25 billion. FDI approvals in January-October reached nearly US$11.6 billion in 759 newly registered projects, down 28.8% in capital and 19.1% in project number year-on-year, according to the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment. An additional US$1.2 billion went to 210 operational projects, bringing the total FDI in the period to US$12.8 billion, which is down 41.9% from a year ago. Fresh FDI approvals have in recent months topped hundreds of millions of dollars per month, instead of billions of dollars as seen before. Last month, for example, capital pledges by new and old projects was a mere US$604 million and things were the same a month earlier. Some cities and provinces reported that since early this year there had been few projects capitalized at billions of dollars. So, the path to achieving the year’s FDI target would be bumpy. However, what has made the FDI picture less dismal is strong disbursement, which has hit US$9 billion in the year to date, almost meeting the year’s target of US$10-11 billion and rising more than 7% year-on-year, FIA said. Experts forecast the FDI situation would improve alongside with the pace of the economic recovery that allows many foreign investors to jumpstart the progress of their newly licensed projects here…... [read more]

Resettlement condo projects face uncertainty By Dinh Dung - The Saigon Times Daily An apartment-for-resettlement project invested by Construction JSC No. 5 is under construction on Nguyen Huu Canh Street in HCMC’s Binh Thanh District - Photo: Dinh Dung HCMC – The HCMC government’s newly-announced plan to build several thousands of condos to replenish the resettlement housing fund is predicted to face uncertainty given the presence of several large-scale apartment schemes still mired in slow execution. With the program to construct 12,500 resettlement apartments, the municipal authority has urged the Department of Construction to review the actual situation and assess the implementation progress of on-going resettlement housing projects. The department needs to submit to the local authority solutions to select investors and suitable investment methods in a bid to complete the plan by late next year. The local authority has also told the construction department to carry out a program to build 11,000 resettlement apartments in the south of the city. It is expected 30 hectares will be set aside for high-rise condo building development in in Nha Be and Binh Chanh districts. Developers have been asked to advance their finances to build these schemes and to sell their resettlement housing funds to local authorities later. Old projects still foot-dragging In early September in 2009, 21st Century International Development Co. started work on a resettlement project of 4,200 flats in Binh Khanh Ward in HCMC’s District 2. Covering about 30 hectares, the US$350 million scheme comprises 10 blocks of 20-25…... [read more]

Housing absorption rate remains low By Thoa Nguyen - The Saigon Times Daily HANOI – The property market will see signs of recovery if policy changes are flexible, interest rates are stable and more capital flows into liquid market segments, according to a foreign property firm. However, some property market segments are grappling with price cuts, low absorption and oversupply. Statistics which market research firms released in the first quarter show apartment prices in Hanoi were declining. According to Savills Vietnam, most districts in the capital city saw apartment prices in the medium-cost segment in quarter one falling, 9% at most, compared to last year’s fourth quarter. The absorption rate in the medium-cost segment was a slight 3% in the first quarter, dropping by nine percentage points, while that of the luxury segment did not change much, at 2%. The whole market recorded an average rate of 7%, down by five percentage points from the previous quarter. Similarly, according to CBRE, investors have steadily lowered their offered prices on the primary market with up to 53% of new apartments sold at less than US$1,000 per square meter. Despite the price drop, Arsh Chaudhry from U.S. firm Cushman & Wakefield said that apartment prices were normally seven times higher than people’s average annual incomes in many countries but in Vietnam, it was 26 times. Although condo prices have edged down and the absorption rate remains low, new supplies are still trickling in, exclusive of unsold apartments of the previous quarter. Figures…... [read more]

Old projects introduced at Vietbuild 2013 Dinh Dung By Dinh Dung - The Saigon Times Daily HCMC – Just a few real estate enterprises joined Vietbuild 2013, the international exhibition on real estate, interior and exterior design, and construction materials, while most projects introduced at the fair were those already launched earlier. In previous years, there were quite many enterprises joining the annual exhibition. But this year, due to scant participation, exhibitors had chances to lure visitors to their booths at the fair, which took place in HCMC from August 14 to 18. Hung Thinh Land Company introduced three condo projects, including a project on Pham Van Hai Street with apartments priced from VND1.7 billion each, Phuc Yen 2 project in Tan Binh District at VND1.2 billion each and Chuong Duong Garden in Tan Phu District at VND13.5 million per square meter. Meanwhile, Phuc Khang Construction & Investment Joint Stock Company continued to introduce to investors the Sunflower City project in Dong Nai Province, offering land lots at VND337 million each. The land lots are measured nearly 100 square meters each and payment will be made in two years. The enterprise also offered Eco Town residential project in HCMC’s Hoc Mon District with land lots from VND600-800 million each. Minh Vinh Khang Trade Joint Stock Company offered special sale for Bao Loc residential area in Lam Dong Province. The enterprise offered land lots at VND599 million each and houses at VND988 million each. A staff of the enterprise said the…... [read more]




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