Early Start-Up Businesses
Right after the Lunar New Year, some real estate businesses have started to kick off the new year with new activities and plans for projects.
For example, Nam Long continues its plan to launch sales in 2024 with projects such as Flora Panorama apartments in Mizuki Park, Akari City, Southgate at the entrance of the Waterpoint urban area, the Can Tho project, and Izumi City. Among them, this company focuses on affordable housing products ranging from 1-3 billion VND ($43,000 – $129,000). Sales revenue of Nam Long is forecasted to recover strongly in 2024, reaching 5,600 billion VND ($240 million) (an increase of 40% compared to 2023).
The company’s sales momentum began in the third quarter of 2023 when the absorption rate of inventories increased significantly compared to the beginning of the year. The market regulation policies gradually came into effect, and the cooling interest rates have made the company’s business results look promising. Starting projects early after the Lunar New Year is part of the company’s plan as the interest of customers in the projects is still relatively good compared to the overall market. Among them, the majority of buyers’ demand is focused on apartment projects with prices ranging from 3 billion VND per unit in Ho Chi Minh City to 1 billion VND per unit in suburban areas.
Similarly, right after returning to work in the new year, Phu Dong Group has started planning to hand over the Phu Dong Sky Garden project in the first quarter of 2024, and continue launching nearly 800 Phu Dong SkyOne apartments (Di An, Binh Duong) to the market from the third quarter of 2024. Just before the Lunar New Year, the company organized an event to sign a cooperation agreement with MB Bank. Accordingly, the bank will provide a credit limit of 500 billion VND ($21 million) to support the implementation of the Phu Dong SkyOne project.
Real estate businesses start the new year.
In 2023, many businesses kept a low profile, but at the beginning of 2024, TTC Land is once again active in its projects. Besides the continuous updates on events related to the TTC Plaza Da Nang project, the activities of this company reselling limited premium apartments at the Panomax River Villa project (Dao Tri Street, District 7) also drew attention. This is a previously “silent” apartment project waiting for the legal procedures to be restarted, with an expected handover in the second quarter of 2025.
Only 3 months after the announcement of the acquisition of land from Tam Luc Company, Gamuda Land Group immediately made efforts to introduce the Eaton Park project (Thu Duc City) with a scale of 3.5 hectares to the market in the second quarter of 2024. It is known that the project has a starting price of 7,000 USD/m2 (around 170 million VND/m2).
Right next to it, Masterise Homes also has plans to commence the high-rise residential area in The Global City (Thu Duc City). According to the plan, the high-rise area will be open for pre-order from the first quarter of 2024 and can start selling from the fourth quarter of the same year.
Also at the beginning of the new year, Chairman of THAC Corporationo Tran Ba Duong sent a message for 2024 to all employees. Accordingly, THAC (Dai Quang Minh) plans to “shock” the market in 2024 by commencing 12 projects, including 2 projects in the North and 10 projects in the South to meet the development plan of the commercial center chain system of THISO from 2024-2027.
Thang Long Real Group besides the FIATO City project in Nhon Trach (Dong Nai) which will release inventory in the first quarters of 2024, the FIATO Premier project in Thu Duc City (Ho Chi Minh City) is also gaining momentum in the new year. This is an apartment project located next to the 2nd ring road of Ho Chi Minh City.
Van Phuc Group is also planning to launch their first high-end condominium at the Van Phuc City urban area in the early 2024. This project was planned to be released in 2023 but missed the schedule multiple times.
Even companies in the process of restructuring like Novaland are not stopping proposing new projects. Recently, the company proposed to invest in a large-scale tourism and resort complex of nearly 437 ha in the Mui Yen area in Binh Thuan province, and at the same time is working with the People’s Committee of Lam Dong province on a mixed-use tourism and resort urban area project combined with entertainment activities in Lam Vien Highlands.
Thus, the early start of activities by developers after the Lunar New Year is expected to bring new supply to the real estate market in the South. This also opens up signals of increased demand in the coming time. For some time now, many investors and buyers have been waiting for new products to be released to the market. The actions at the beginning of 2024 help developers regain their “momentum” and the trust of homebuyers.
The playing field has changed?
Many opinions suggest that the current real estate market context has changed, and businesses must adapt. Looking back at over a year of real estate business restructuring, most companies have aimed to sell products that the market needs to accumulate cash flow for the recovery process in the coming years.
In a series of directives to remove difficulties for the real estate market, the Prime Minister instructed the Ministry of Construction to study guidelines on reducing selling prices and restructuring segments for real estate businesses. In fact, in addition to policy support, many real estate businesses have restructured their products and prices to match the majority of market demand.
Recent developments in the Southern real estate market show that transactions in some apartment projects have rebounded due to reasonable prices. Businesses themselves are finding ways to “optimize” all costs, including reducing profits to offer affordable products to buyers, promoting market liquidity.
Affordable housing products are seen as a sustainable playground in the real estate market.
In a recent sharing, a representative of Nam Long Group stated that affordable housing is understood to provide products that customers can afford in each segment. Accordingly, to prepare for the recovery, businesses must be willing to overlook small advantages to overcome this difficult period by building accompanying policies with their customers.
Similarly, Phu Dong Group, which specializes in developing affordable apartment projects, believes that businesses should continue to focus their resources on developing products with high demand to boost market liquidity. In difficult times, businesses must consider costs, including reducing profits, to structure product prices at the most reasonable level for buyers.
According to a HoREA representative, the key to removing difficulties for the real estate market lies in affordable housing. This product category is considered a sustainable playground in the real estate market.
