Where do individuals get money if there are no affordable apartments?

DNHN - There are currently no affordable apartments; 20% are priced between thirty and forty-five million yuan per square meter, and 80% are priced between fifty and sixty million yuan per square meter or more; how can people save enough money to buy? Therefore, it is vital to examine who purchased it and where the money is.

Mr Le Huu Nghia, General Director of Le Thanh Real Estate Company, shared this information on May 7 at the program "The 62nd Huba Entrepreneur Café", coordinated by the Ho Chi Minh City Business Association (HUBA) and the Club Real Estate Ho Chi Minh City (HREC) with the theme: "Trends of the real estate market in 2022." 

"Loosening the law" for buyers from other countries

Mr Nghia believes one issue is that firms are "blind" to information since many projects are still untaxed. They must sell pricey items that "depreciate" for safety concerns. Despite the huge return, it normally takes 5 years to complete and sell a project. The profit covers the recruiting and payment of employees, so only the buyer has a "heavenly" price.

It's all about supply and demand, he added. The sellers run the market. They sell what they have, so prices rise. Land prices have quadrupled or tripled in the previous two years, while input costs are quite high.

Mr Nghia believes the real estate market will continue to grow in 2022, despite the lack of a "fever." The supply issues won't be resolved until 2023. Everyone who buys a property expects to generate a profit of at least 20% every year. They have to "pocket" 10% after taking the 10% interest rate from the bank.

Because the state has made it harder for people to get loans, they have had to sell a lot of real estates. This has led to more supply on the secondary market, more stable prices, and a chance to go back to real residential real estate. The other parts will be hard.

Mr Nghia said that firms now believe there are three avenues for mobilization. It is the safest and most long-term option for companies to acquire money. Currently, corporations are cautious to sell bonds or stocks because they are uncertain about purchasers. A bank loan is another option. The third channel comes from speculators, thus tightening the valve will also affect them.

Mr Nghia also says that it is important to make it easier for foreigners to buy and sell real estate. Specifically, it's important to let foreigners buy because this is a form of export on the spot that is safe. After all, real estate can't be moved and only goes up in value, so it can be bought and sold.

Mr Nghia says that it is important to invest in urban development and not let "ghost cities" exist. It is also important not to buy land just to grow grass to feed cows. Because of the oil spill, the area needs a plan for satellite urban development.

People will have "home fever" when finance becomes more scarce 

Dr Dang Hung Vo, former Deputy Minister of Natural Resources and Environment, says the Vietnamese residential real estate market is "feverish." Depending on the location, the investor may raise or decrease the price by 1-2 times the original predicted price. Virtual firms raise their fees arbitrarily.

On the other hand, others argue that reducing public investment and limiting credit are required to calm the real estate market. Mr Dang Hung Vo believes this should be explored since it is akin to the chicken or the egg story. Credit limitations will generate a shortage of real estate "demand" for houses and land is always high.

The government and provincial People's Committees must evaluate the projects." If there are unfinished projects or prospective products, they may postpone loan issues owing to risks. To establish 100% real house supply in the short future, Mr Dang Hung Vo advocated "continuing to extend credit to produce supply for the market."

According to Mr Nguyen Quoc Bao, Chairman of HREC and DT24.VN Real Estate and Capital Investment Joint Stock Company, real estate impacts practically every business. Because investing in any firm entails the purchase of real estate assets. Residential real estate, offices, and land parcels, industrial parks, agricultural, and forestry... So, how is the housing market doing? They want to know where and how to invest.

Consumers and investors may reconcile interests to produce sustainable growth, which is a trend in sustainable real estate. According to Mr Bao, the annual revenue from real estate-related businesses surpasses $100 billion.

As a result of the government's restrictions on real estate loans, the country's real estate was frozen. As a consequence, the credit constraint will affect businesses.

The Chairman of THORAKAO Company and Chairman of Ben Tre Entrepreneur Club in Ho Chi Minh City, Mr Huynh Ky Tran, says investors should focus on new sites since prices are still reasonable. The Mekong Delta has fruit trees and waterways that can increase garden tourism, so long-term investors should consider investing here in the future.

Finally, Mr Le Huu Nghia advised investors to invest in deteriorating highways like Bien Hoa-Vung Tau and Dau Giay-Phan Thiet. The Can Tho highway links Soc Trang and An Giang to the west. In three years, the price will climb.

Hoang Gia- My Dung