Affordable and social housing is likely to see high demand in 2023 which would help ease the market stagnation, said realty experts and developers.
Apartments priced from VND40 million to VND60 million ($1,700-2,550) per square meter will be in high demand this year. The good news is there are reputable developers who have an interest in this segment, they said.
Dinh Minh Tuan, south region director of the real estate platform Batdongsan.com.vn, noted that real demand would help ease the stagnation in the current market, and the affordable segment is forecast to be in focus this year.
“Developers are restructuring their debts and sales policies, focusing on serving real demand. In addition, real estate prices are expected to fall further,” he said.
According to Vietnam Real Estate Brokers Association vice chairman Nguyen Van Dinh, apartments in the price range of VND2-3 billion ($85,000–$127,500) would be the main target.
“Customers will look for products with reasonable prices before deciding to buy,” Dinh said.
Similarly, Asian Holding CEO Nguyen Van Hau told The Investor that the price range will welcome more buyers. He added that the social housing segment will rally thanks to reasonable prices as developers are controlled in terms of profit. In addition, social housing buyers can receive support in terms of decades-long lending rates.
Demand exists
Despite many fluctuations in the Vietnamese market in 2022, the affordable apartment segment in the Greater Ho Chi Minh City region remained attractive, unlike other segments.
Multiple transactions have been recorded in the above-mentioned price range. Apartments at two Nam Long Group-developed projects, Akari City in Binh Tan district and Flora Panorama in Binh Chanh district, both in HCMC, have seen 80-90% of supply traded.
Currently, the price for a two-bedroom apartment with an area of 75 square meters at Akari City’s phase 2 is about VND2.9-3 billion ($127,700), while a two-bedroom apartment of 54 square meters is a little cheaper at VND2.4-2.5 billion ($106,400). The four towers of Akari City’s phase 2 are scheduled for completion in the third quarter of 2024.
In the east of HCMC, the MT Eastmark City project developed by Dien Phuc Thanh Company has also shown a very high absorption rate. After two rounds of sales, the project has sold about 1,000 apartments. The first round’s price last April was VND36 million ($1,530) per square meter, and the second round’s price last July was a little higher at VND39 million ($1,657).
MT Eastmark City is expected to offer more apartments this year, with primary prices of VND40-43 million (1,830) per square meter, slightly higher than the second round.
In the city suburbs, the Phu Dong Sky Garden project developed by Phu Dong Group has an affordable price of VND40 million ($1,700) per m2. The project has more than 600 apartments in all, with construction beginning in March 2022 and delivery set for 2024.
The Vietnamese residential market in 2023 will continue to face many challenges such as tightened monetary policy, high lending rates, and low liquidity in the market. The outlook is expected to improve in late 2023 and stabilize in 2024, said experts and developers.