Is this a good year to invest in real estate?

Following a series of efforts to support the real estate market by the Government, ministries, departments, and localities, the National Assembly recently passed 3 important laws: Housing Law, Real Estate Business Law, and Land Law. These are considered important legal foundations and motivations that will help the real estate market gradually recover in 2024, before entering a period of strong development in the following years.

A market report released by Dat Xanh Services Institute for Economic, Financial, and Real Estate Research shows that in the first month of the year, the number of new projects introduced to the market is still very scarce. New supply only comes from a few key projects. However, the absorption rate is relatively good.

According to the report, new supply comes from Hanoi and surrounding provinces, including Hung Yen, Bac Ninh, Bac Giang, and Quang Ninh, with nearly 500 products, a decrease of 50% compared to the previous month. The absorption rate is from 35-40%. Meanwhile, Ho Chi Minh City and surrounding provinces such as Binh Duong, Dong Nai, and Long An receive nearly 800 products, an increase of 90% compared to the previous month. The absorption rate is from 20-25%.

In the first month of the year, investors are still in a race to introduce many “blockbuster” policies to support customers, such as extending payment deadlines, increasing interest support time, free management, guaranteed rental time, etc.

Mr. Vu Cuong Quyet, General Director of Dat Xanh North, said that the real estate market in 2024 is a good opportunity for investors as the prices of some investment segments have come down, and only real estate for living purposes is sustaining its value.

“In 2025, when the Housing Law, Real Estate Business Law, and Land Law are officially amended and take effect, land prices, land taxes, compensation prices will be based on market prices, causing land prices, costs, and project costs to increase. Therefore, 2024 is a good time for investors to consider investing in land, adjacent projects, and villas before the new laws take effect. Markets like Hanoi or provinces attracting strong FDI inflows are good investment areas. It is very risky to invest in places that do not attract many people,” Mr. Quyet advised.

According to Mr. Nguyen Van Cuong, Chairman of the Real Estate Brokers Association of Vietnam in Dong Nai province, the real estate market in 2024 will be brighter and be the “golden time” of real estate. Quarters I and II are seen as opportunities for investors to “bottom out” and own potential real estate at good prices. The market will be at its best in Q3/2024.

According to Mr. Cuong, to achieve positive changes for the real estate sector, mention must be made of the Government’s support policies, the continuous decrease in interest rates by the State Bank for real estate investment. The fact that the State passes important laws such as Land Law, Real Estate Business Law, Housing Law, which take effect on January 1, 2025, is also a strong motivation to promote real estate market growth.

When the Land Law, Housing Law, and Real Estate Business Law are passed and take effect on January 1, 2025, many issues and bottlenecks in the land acquisition process will be resolved, and businesses will have a more favorable land access. At that time, the supply may increase and the scarcity of housing can be addressed.

In addition, the regulation of annual land use fees will help investors reduce the financial burden in the initial period when implementing a project. Thanks to this, the selling prices of real estate products also have the opportunity to be adjusted more reasonably. Developers will not have too much financial pressure and will also have room to invest in improving projects with better quality.

“These changes are reasonable and positive, making an important contribution to the fair and stable development of the real estate market,” affirmed Mr. Cuong.