Rising demand keeps suburban land prices high
Since the beginning of the lunar year, investors looking to buy land have begun planning their hunting trips. However, despite landowners offering discounts of up to 20 – 30%, prices remain high compared to the current market situation.
With more than 3 billion VND in financial resources, Mr. Nguyen Van Dung (Nam Tu Liem, Hanoi) is still struggling to “hunt” for land in the outskirts of Hanoi. According to Mr. Dung, the reason he has not been able to finalize any transactions is because the landowners are still asking for high prices.
“The landowners claim that prices have dropped by 20 – 30% compared to the beginning of 2022, but they are still relatively high. There are even plots of land that are being sold at a loss, yet the prices are still comparable to the peak of the real estate fever. The plots with lower prices have very poor locations,” Mr. Dung said.
Mr. Dung provided an example of a plot of land in Yen Binh (Thach That, Hanoi) with an area of 70m2 that is part of a separate land division, which is still being offered for sale at 26 million VND/m2, equivalent to a land value of over 1.8 billion VND.
“Even though it is a self-divided land area with overgrown grass. The entire area is still just an empty plot of land, and compared to the end of 2021, the prices are still similar,” Mr. Dung said.
Similarly, Ms. Nguyen Xuyen (Ha Dong, Hanoi) stated that she has visited the Soc Son area (Hanoi) several times since the beginning of the year with the intention of purchasing land for a 3 to 5-year investment plan. However, after researching, she found that the current land prices are not significantly different from the end of 2021, despite the landowners offering a 20% discount. Moreover, some plots of land near the construction site of Ring Road 4, which have good locations, have seen a slight increase in prices.
“After more than a month of searching with a budget of 4 billion VND, I still haven’t made a purchase because many people are asking for prices that are too high,” she said.
In our discussion, Mr. Vu Thanh Tung, the owner of a real estate trading floor in Hanoi, said that in reality, many land plots in the outskirts of Hanoi still have relatively high prices. The landowners expect to make a profit before accepting any offers because they do not face financial pressure.
“However, not all land plots can be easily sold, and sometimes it takes months or even years to find buyers. The landowners keep offering their plots for sale, and those who agree to buy will make the payment. In addition, there are cases where brokers intentionally sell at a loss to attract potential buyers,” Mr. Tung said.
According to Mr. Tung, buyers always hope to find cheap land with good locations and clear legal status to gain an advantage.
Discounted land plots have decreased
According to data from Batdongsan.com.vn, in the land plot segment, the number of listings offering discounts has decreased in the last quarters of 2023, but the market has not yet fully recovered in terms of interest and liquidity.
Mr. Dinh Minh Tuan, Director of Batdongsan in the southern region, assessed that in the near future, the land plot market will continue to face difficulties.
However, in the long run, land prices may continue to rise and transactions will resume. Real estate prices depend on other factors such as infrastructure development, economic growth, and people’s incomes.
“Land plots are a type of investment that anyone in the market can engage in due to the diversity in size, prices, and areas. In areas with economic development, these plots will still see sustainable growth,” Mr. Tuan said.
According to Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association (VARS), more investors have started their “hunting” journey in areas near major cities and regions with strong infrastructure development and rapid urbanization, where prices are considered quite favorable and there is room for future growth. In addition, the demand for land plots as assets is still preferred by investors and continues to be the top choice segment.
