Most property experts have said the market will continue facing difficulties, at least to the end of the second quarter, while some expect the market will begin improving early this year.
Those in charge of business of the property projects hold a positive view that the efforts of the authorities and the banking sector will help pull up the market. They explain now is the chance for buyers with actual demands for housing to make good bargains.
The Saigon Times Daily’s observations show that after the long Tet holiday, most property exchanges in Hanoi have resumed operation. Some of them have signed their first contracts of the year for brokerage of apartments, residential land or semi-detached houses.
A representative of the property exchange Phuc Thinh in Cau Giay District, Hanoi says his office has successfully brought back two apartment purchase contracts in Dich Vong and Xa La on the first opening day after Tet. Since early January, the two offices of this brokerage firm have won four apartment and land contracts against the five signed in the last quarter of 2011.
In explanation of the prospering business since early 2012, the representative says some investors deem it good luck to make transactions at the year’s beginning. Meanwhile, those in need of housing make use of the low season after Tet to look for houses at reasonable prices.
Thanh Tri District is where Hanoi citizens aim at as this area is not too far from the downtown area. Residents in Duyen Ha Commune, Thanh Tri District say that after Tet, many people have come to seek residential land and some successful transactions have been made.
Representatives of many other real estate trading floors in Hanoi show optimism about the market’s short-term outlook.
However, property experts say the market may not prosper much this year since funding for the sector remains heavily dependent on the banking system. If interest rates are still high, the market cannot thrive.
Furthermore, Nguyen Van Duc, director of Dat Land Real Estate Co., says many cash-strapped investors would sell their projects to pay their debts. If the situation worsened this year, many investors would have to restructure their financing sources.
If the central bank flexibly and selectively relaxed its credit policy for the property market, and if proposals by ministries were approved by the Government, the market could make some recovery, but not until the third and fourth quarter of 2012, said a representative of the Vietnam Real Estate Association.
In fact, apart from a few small transactions, many big projects in Hanoi have not recorded positive changes in their sales. A project on Kim Dong Street has attracted much attention because of the selling price of only VND18 million per square meter, coupled with autos as gifts, to improve the sluggish pre-Tet sales.
Some 22,000 apartments of 60 projects will be launched in Hanoi this year, according to a report by CBRE. This will put more pressure on property developers as trading volume is expected to stay low and the percentage of successful deals insignificant.
Besides, they will have to compete with investors involved in land lot selling projects, who have pulled down their prices sharply in last year’s fourth quarter.
The property service provider says that the future developments of the market will depend much on the recovery of the economy.
By the end of 2012, the housing projects whose prices are VND21 million per square meter will stay resilient. Besides, the luxury projects in the downtown Hanoi and HCMC will catch the attention of financially capable investors and families with deep pockets.
(Source: Saigon Times.)
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