Speculative groups stand behind Hanoi apartment fever: association
The recent apartment fever that has swept in Hanoi shows signs of being impacted by speculative groups who have created virtual supply and demand to push prices up, according to the Vietnam Association of Realtors (VARS).
The association said that since 2018, policies related to capital sources and decisions by relevant agencies to control the real estate market have changed, causing a serious decrease in housing supply. Constantly increasing demand for housing has put pressure on supply, pushing prices up, especially for the apartment segment in the capital city in Q1/2024.
Apartment prices in Hanoi have increased for dozens of consecutive quarters. The apartment price index in Hanoi in Q1/2024 rose 48% compared to the same quarter of 2019 and 8 percentage points from Q4/2023 - the highest expansion in the past five years.
Regarding the cause, VARS found that the increase in apartment prices in Hanoi is due to the continuous improvement of infrastructure, thus hiking real estate value. However, the price increase of up to 3-4 times is unreasonable, it noted.
Besides, the Hanoi market is too short of supply while the demand for housing is always high and on an increasing trend, it added.
The price increase is also due to high investment demand when large cash flows are running into real estate in the context of bank interest rates hitting the "bottom". At the same time, the demand for investment in apartments for rent has been driven by the accommodation needs of a large number of international tourists, foreign experts, and students.
According to VARS, by 2025, Hanoi's population is expected to reach 9 million people, with the urbanization rate estimated at 62%. Of them, 5.58 million people will live in urban areas, up from more than 4.13 million in 2022 and equivalent to about 120,000 new urban households each year.
According to Hanoi's housing development plan for 2021-2025, the total demand for the period is 185,200 houses, including 166,600 apartments. Meanwhile, the number of new apartments opened for sale in the capital is continuously decreasing.
Last year, the supply of new apartments only approximated 11,000, equal to 66% of the figure in the same period in 2022. In Q1/2024, the entire Hanoi market recorded only 3,000 new apartments for sale.
"From now until 2025, Hanoi will face a shortage of about 50,000 apartments. Meanwhile, the number of newly licensed commercial housing projects is continuously declining, and affordable apartments are completely absent from the market," VARS said.
The association believed that the increase in Hanoi apartment prices due to scarcity is an effect of the supply-demand rule. Supply is smaller than demand, forcing prices to increase to ensure balance.
Although the price increase shows signs of being impacted by speculative groups who have created virtual supply and demand to push up prices in the market, it is difficult to identify and handle acts of apartment speculation and price inflation.
The right to determine the selling price belongs to the property owner and the parties engage in a purchase and sale transaction when they reach an agreement, said VARS. In the context of scare supply, individuals and businesses with goods have an advantage in setting prices. It is inevitable that sellers will push prices when products are scarce in the market, it added.
"To stabilize apartment prices, there needs to be coordination between state agencies and market participants," the association stated.
To make house prices stable, VARS recommended that state agencies continue to promote the development of transportation infrastructure to shorten travel time from the satellite area to the city center. Increasing supply from suburban areas will drag down housing prices.
Efforts need to be made to speed up the progress of social housing projects; proactively regulate supply by effectively using tools to make and adjust planning schemes; arrange more clean land funds to help investors implement social housing projects right after planning schemes are made, the association added.
It is necessary to soon approve a pilot project to implement commercial housing projects in case the developer agrees to receive land use rights or has the right to use residential land or other land to promote apartment supply; speed up the renovation and construction of old apartments, and consider imposing progressive tax rates on real estate owners based on the number and scale of properties to ease motivation for speculation.
For customers and investors, VARS recommended that in this context, they should be alert and choose suitable products with guaranteed financial and legal capabilities; and absolutely not follow the "fever".
“Developers need to adjust selling prices to reasonable levels and strictly control distribution channels. Exchanges and brokers should deliver appropriate consultations, not work for personal gains, and provide maximum support for customers' trading activities," it added.
- Read More
Hanoi TikToker internationally wanted for involving in multi-billion-dollar investment scam
Hanoi police have issued an international arrest warrant for Le Khac Ngo, known as "Mr. Hunter," a key accomplice in a recently-dismantled massive foreign exchange and securities fraud ring.
Society - Sat, December 21, 2024 | 10:57 pm GMT+7
Unlocking Phu Quoc’s potential to become the 'Hawaii of the East'
Leading global tourism companies have remarked that Phu Quoc has "yet to receive the recognition it deserves," despite its impressive and unexpected growth rate.
Travel - Sat, December 21, 2024 | 7:20 pm GMT+7
Thai central bank maintains policy interest rate at 2.25%
The Thai Chamber of Commerce (TCC) has said it backs the decision by the Bank of Thailand, the country's central bank, to maintain the policy interest rate at 2.25%, considering the move as suitable for a reviving economy.
Southeast Asia - Sat, December 21, 2024 | 5:43 pm GMT+7
Vietnam's military-run tech giant Viettel strikes big deals at international defence expo
Subsidiaries of Military Industry and Telecommunications Group (Viettel) signed a string of significant contracts with major global partners during the first two days of the Vietnam International Defence Expo 2024 in Hanoi.
Companies - Sat, December 21, 2024 | 5:36 pm GMT+7
Taiwan’s Wistron acquires 37ha land lot in northern Vietnam for expansion
Taiwan-headquartered Wistron, a top electronics provider and an Apple supplier, will further its investment in Vietnam’s northern province of Ha Nam by acquiring another 37.1-hectare land lot.
Companies - Sat, December 21, 2024 | 2:08 pm GMT+7
VAFIE seeks to promote sci-tech development, intellectual property policies
The Vietnam’s Association of Foreign Invested Enterprises (VAFIE) aims to enhance policies for the development of science, technology, and intellectual property, creating a more conducive investment environment.
Companies - Sat, December 21, 2024 | 1:59 pm GMT+7
Vietnamese dong likely to depreciate 3% in 2025: VinaCapital
The Vietnamese dong is likely to depreciate 3% in 2025 on anticipation that the US Dollar/DXY Index will finish 2025 nearly unchanged, says Michael Kokalari, chief economist at Vietnam's leading fund manager VinaCapital.
Economy - Sat, December 21, 2024 | 11:23 am GMT+7
First luxury railway journey across Vietnam features Indochine architecture
PYS Travel has launched the first luxury railway journey across Vietnam named Sjourney, marking a new milestone in the railway tourism sector.
Travel - Sat, December 21, 2024 | 10:09 am GMT+7
Vietnam among 40 most beautiful countries: US publication
Vietnam has secured the 36th position in the ranking of the 40 most beautiful countries in 2024 in a testament to its undeniable charm and appeal, according to US News & World Report.
Travel - Sat, December 21, 2024 | 10:04 am GMT+7
Foxconn to invest $16 mln more in Vietnam’s Quang Ninh province
Competition Team Technology (Vietnam) Company Limited, a subsidiary of Foxconn, will invest an extra $16 million in its “S- Vietnam” project in the northern coastal province of Quang Ninh.
Industries - Sat, December 21, 2024 | 9:53 am GMT+7
Vietnam’s small- and medium-sized businesses embrace digitization to weather global expansion risks: survey
While global expansion remains a key priority for the country's small- and medium-sized businesses (SMBs), achieving this goal requires overcoming challenges by leveraging the right talent and advanced technologies, including AI, according to Payoneer’s findings.
Companies - Sat, December 21, 2024 | 7:56 am GMT+7
Vietnam tax authorities collect $169 mln from delinquent taxpayers through exit bans
Vietnam's tax authorities have collected about VND4.3 trillion ($169 million) from 6,500 delinquent taxpayers through exit ban measures so far this year, nearly five times the amount reported in the middle of the year.
Finance - Fri, December 20, 2024 | 10:29 pm GMT+7
French, Chinese EV manufacturers to invest in Indonesia
Three global electric vehicle (EV) manufacturers - France’s Citroen and China’s BYD and AION - have committed to establishing EV manufacturing plants in Indonesia, Minister of Industry Agus Gumiwang Kartasasmita has announced.
Southeast Asia - Fri, December 20, 2024 | 6:42 pm GMT+7
Thailand optimistic about export prospects for 2025
With an upbeat export growth projection of about 5% this year, Thailand's Ministry of Commerce and its private sector are optimistic for a further 2-3% growth in 2025, bringing total export value to about $305 billion.
Southeast Asia - Fri, December 20, 2024 | 6:36 pm GMT+7
Philippines imposes temporary import ban on live cattle from Japan
The Philippines has imposed a temporary ban on the importation of live cattle and buffalo as well as their products from Japan due to the outbreak of lumpy skin disease (LSD), its Department of Agriculture said on Thursday.
Southeast Asia - Fri, December 20, 2024 | 5:53 pm GMT+7
Malaysia-China trade hits nearly $100 bln
Malaysia-China economic ties have continued to strengthen, with bilateral trade reaching nearly $98 billion between January and November, matching the 2023 total trade volume.
Southeast Asia - Fri, December 20, 2024 | 5:51 pm GMT+7