Positive indicators from the real estate market
The General Statistics Office has recently released a report on the economic and social situation in the first two months of 2024, which includes positive indicators for the real estate market. According to the report, the real estate business has seen positive signals in terms of demand for real estate and the number of real estate enterprises returning to the market. There have been 552 newly established real estate enterprises, accounting for 100.4% compared to the same period in 2023. The number of reactivated enterprises is 843, up 138.7% compared to the same period in 2023.
Notably, the condominium segment still attracts significant attention despite the high prices. Speaking at the “Real Estate Market Trends Update 2024” event, Mr. Vo Huynh Tuan Kiet, Director of Residential at CBRE Vietnam, stated that apartment prices in Hanoi have increased more than in Ho Chi Minh City. Compared to the beginning of 2023, the price of apartments in Hanoi has increased by about 15%. The main reason is the limited supply and the low number of new products entering the market, which has pushed up the overall price level. According to VARS research data, the apartment price index in Hanoi has increased by about 38 percentage points in the beginning of 2024 compared to 2019. Despite the rising prices, the demand for owning a home remains high.
According to data from batdongsan.com.vn, in January 2024, the rate of people searching for real estate nationwide increased by 66% compared to the same period in 2023. Hanoi and Ho Chi Minh City were the two leading localities in terms of people searching for real estate, with a focus on the condominium segment, accounting for 71% and 59% respectively. In addition, the low-rise and land segments also saw a significant increase in searches. Specifically, in January 2024, the number of searches for land in Hanoi increased by 110%, and the number of searches for project land increased by 77% compared to the same period in 2023.
Vacant land – Ready for the “bull market”
Amidst the bustling real estate market at the beginning of 2024, the vacant land segment is still considered a worthwhile investment due to its inherent advantages and favorable market factors. Traditional investment channels such as banks, securities, and gold are no longer attractive to savvy investors. The continuously increasing gold price has made many investors cautious. On the other hand, deposit interest rates have dropped to record lows. In contrast, apartment prices have increased three times since 2022, with the latest increase of 4-5% from the end of 2023 to the present. The primary price in the mid-range segment ranges from 40-60 million VND/m2, while the high-end segment ranges from 65-90 million VND/m2, and the luxury segment starts from 100 million VND/m2. Therefore, for many investors, shifting their money to investment channels such as vacant land is a wise move at this time. Especially, projects with large land value, located near industrial zones, clear legal status, and reasonable investment costs, will be suitable for the majority of investors who want to redirect their funds.
Vacant land in suburban markets like Ha Nam is bustling and attracting many customers.
Mr. Nguyen Van Tan, CEO of AHS Real Estate Joint Stock Company, said, “The vacant land segment will be the most attractive investment product in 2024. Especially, projects with moderate investment levels ranging from 1-2 billion VND and clear legal status will be suitable for many customers. In the current context, existing investment channels are no longer attractive, and vacant land will take the lead and become the channel to attract capital from investors.” Along with this viewpoint, Mr. Vo Hong Thang, Director of Consulting Services and Project Development at DKRA Group, considers vacant land to be a sustainable investment channel. Vietnamese people have a preference for houses attached to land, and vacant land is seen as a safe asset accumulation channel with high profit potential. Additionally, compared to other segments, the legal status of vacant land is more stable and transparent.
