Each week we post a news flash with notable articles related to the real estate market in Vietnam. We asked our team to pick the top stories from the past month and we’ve tallied the results. Check out the headlines that made big news in our office below. Have any of the articles we’ve shared impacted you? Is there any important news we’ve missed? We’d love to hear from you!
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- 1. The Ministry of Construction announced real estate prices in Da Nang
- 2. Apartment prices have shown signs of slowing down since the second quarter
- 3. The next 3-6 months are tough times for real estate.
- 4. Da Nang is shifting to developing luxury apartments, repositioning the market
- 5. Condotel segment in Da Nang thrives when tourists come back
JULY 2022 CENTRAL VIETNAM REAL ESTATE NEWS SUMMARY
1. The Ministry of Construction announced real estate prices in Da Nang
According to the Ministry of Construction, nationwide records show that the supply of commercial housing in the second quarter has not improved, especially since the number of newly licensed projects is only 42% compared to the same period in 2021.
In which, the Central region, three commercial housing projects are being prepared for investment with 961 units. In addition, there are 211 projects with more than 131,000 apartments under construction.
The central provinces are having 18 projects with 3,738 commercial apartments eligible to sell houses in the future.
The Ministry of Construction also recorded that in the Central region, there were nearly 20,000 successful transactions of apartments and individual houses. The number of successful land transactions in this area is nearly 70,000.
Regarding market prices in Da Nang, the Ministry of Construction recorded that in the segment of affordable apartments with the FPT Plaza Apartment project (Ngu Hanh Son district) the price is about 25.7 million VND/m2.
The mid-end apartment segment has The Sang Residence project (Ngu Hanh Son district) with a price of about 46 million VND/m2. The high-end segment has the M Landmark Residence project (Hai Chau district) with a price of about 120 million VND/m2.
Regarding the individual housing segment, land in Da Nang has the Euro Village 2 project (Cam Le district) priced at about 92 million VND/m2, the Tuyen Son South Bridge project (Ngu Hanh Son district) with the price of about 115 million VND. VND/m2.
According to the Ministry of Construction, the prices of individual houses and land plots in projects in the second quarter tended to slow down in most localities when business and service investment activities in other industries and fields. restored, back to normal.
- As Da Nang continues to develop into a major economic center and international destination, CVR can help you find suitable real estate that fits your specific needs whether it’s for a business or a new home. Interested in learning about opportunities in Central Vietnam? Contact the CVR team today!
2. Apartment prices have shown signs of slowing down since the second quarter
The Ministry of Construction has just released the Real Estate Market Report for the second quarter of 2022, showing that the supply of commercial housing in the quarter has not improved. Especially, the number of newly licensed projects is only about 42% compared to the same period in 2021.
Along with that, apartment prices also recorded a slowdown in the second quarter.
However, there are very few affordable apartment projects in the market with prices from 25-30 million VND/m2.
Commercial housing projects in the central areas of urban areas have almost no apartments with prices below 25 million VND/m2. This price is only available in a few projects in remote areas.
For example, in Hanoi, a project xpHOMES (Dan Phuong district) priced at 29 million VND/m2, Gemek Premium project (Hoai Duc district) priced at 26 million VND/m2, Xuan Mai Complex project (Ha Dong district) priced at about 27 million VND/m2.
In Ho Chi Minh City, the Dream Home Riverside project (District 8) costs about 27 million VND/m2, and the Ehome S project (District 9) costs about 25 million VND/m2.
In Da Nang, the FPT City Danang project (Ngu Hanh Son district) costs about 25.7 million VND/m2.
Mid-end apartments (with the price of about 30 million VND/m2 to less than 50 million VND/m2) are still the main products in the market.
In Hanoi, the Keangnam project, (Nam Tu Liem district) costs about 45 million VND/m2, and the Melody Residences project (Hoang Mai district) costs about 45 million VND/m2, Vinhomes Smart City project (Nam Tu district) costs about 45 million VND/m2. Liem) cost about 36 million VND/m2.
In the city. In Ho Chi Minh City, the Sunrise City project (District 7) costs about 40 million VND/m2, Cityland Park Hills project (Go Vap district) costs about 49 million VND/m2.
In Da Nang, The Sang Residence project (Ngu Hanh Son district) costs about 46 million VND/m2,…
In the segment of high-end apartments (with a price tag of over 50 million), in Hanoi and Ho Chi Minh City, some projects with special locations and centers have very high advertising and selling prices such as Heritage West Lake. (Tay Ho district, Hanoi) costs about 75 million VND/m2, the T-Place project (Hoan Kien district, Hanoi) costs about 325 million VND/m2, Grand Marina Saigon project (District 1, Ho Chi Minh City). HCM) costs about 300 million VND/m2, Vinhomes Golden River Ba Son project (District 1, Ho Chi Minh City) costs about 170 million VND/m2, M Landmark Residence project (Hai Chau district, Da Nang city) priced at about 120 million VND/m2,…
However, in fact, people with real housing needs think that house prices are still increasing compared to the beginning of the year. Many people, after many times delaying buying a house, waiting for the price to decrease, had to accept to buy back the apartment they liked before with a price difference of 200-300 million VND.
3. The next 3-6 months are tough times for real estate.
The real estate market is being affected by political instability, the world economy, along with macro factors, so it is difficult to predict when it comes to real estate. the market will recover, and liquidity will be stable.
The borrowers must definitely sell, even at a loss, to recover capital and repay debt. As for those who have the ability and strong financial potential, they can hold out for a long time. However, if the price is still anchored high, the market will still find it difficult to liquidate, with few transactions. Therefore, in the coming time, the real estate market may tend to correct in a downward direction, returning to a more balanced state.
The real estate market is still receiving bright spots, but the general picture is that real estate prices are dozens of times higher than the average income of people, leading to the absorption of products. product deteriorates during this period.
The investors entering the market for the purpose of surfing in the current period could hardly survive because buying real estate should not be thought of selling within 6 months or so. 12 months but must last from 12 – 36 months. Investors should consider carefully, do not use bank loans to invest because interest rates are increasing.
The real estate market is showing signs of decreasing prices by 3-5%. The next 3-6 months is a difficult time for real estate because the credit room has not yet shown a signal of reopening. Real estate will tend to decrease in price and slow down transactions. Products in the inner city with prices over 20 billion dong and suburban products over 10 billion dongs began to accept discounts to sell. If it is still difficult as it is now, liquidity is likely to continue to decrease by 5-10% for high-value real estate.
4. Da Nang is shifting to developing luxury apartments, repositioning the market
Da Nang is gradually forming a centrifugal development trend, similar to Hanoi and Ho Chi Minh City. In that trend, Da Nang will focus on developing semi-luxury apartment projects and high-class urban areas.
Repositioning the apartment market
In the first half of this year alone, Da Nang did not record new projects for the first time for sale.
In the next 3 years, the Danang apartment market is expected to accelerate development, with new supply from 10 projects providing 5,600 apartments, with a CAGR of 22%/year from 2021-2024.
Luxury apartments will lead the supply, so the primary price level will achieve a CAGR of 12%/year from 2021-2024.
The apartment market for sale is forecasted to be repositioned in the coming period, with the trend of developing riverside apartments gradually becoming popular in Da Nang. These are iconic projects while providing high-class living services.
Blooming riverside urban areas
In the first 6 months of 2022, the townhouse market had one more new project, first launched in the second quarter of 2022 with 106 products including villas and townhouses.
The current total supply is 1,624 products (residential villas, townhouses, commercial townhouses) from 11 projects.
With the mainland real estate market, villas and townhouses have no new supply, so the primary selling price is almost unchanged during this period, anchored at nearly $3,330 and $3,450/m2 respectively.
Entering the first half of this year, the average primary price of villas and townhouses was pushed to a higher level, touching $3,780 and $3,900/m2 respectively. Particularly for the commercial townhouse category, in 2021, the Regal Pavillion project was first launched with a high price, more than 6,500 USD/m2, raising the price level of this segment to double the level recorded in 2019.
The supply of mainland real estate in Da Nang has not increased dramatically for many years. As a result, the cumulative absorption rate of the whole market has remained at a positive level of 92% up to now.
- Interested in learning about investing in Central Vietnam? With a decade of experience, we’re your number one resource for residential and commercial real estate opportunities in and around Da Nang. Contact the CVR team today
5. Condotel segment in Da Nang thrives when tourists come back
The Covid-19 pandemic has been basically controlled, tourism has returned to the rhythm of welcoming guests. At weekends or holidays, traditional tourist hotels/venues run out of rooms. However, in contrast to the extremely vibrant rental market, the resort real estate market is still very slow.
In Da Nang, the condotel is in the following type of key resort real estate. The condotel apartment market has gone through a very difficult period. Since late 2018 this field has reduced the rate of saturation of the supply. Along with that, a series of factors such as the breakdown of profit commitment at Cocobay, the covid-19 pandemic lasted for 2 consecutive years, causing the real estate – vacation market to fall into a frozen state. paralysis.
An announcement from the Vietnam Real Estate Brokers Association knows that in the third quarter of 2018, resort real estate nationwide recorded only about 1,000 successful transactions, but condotels across the country are about 15,000-20,000 units. Key condotel schools like Da Nang and Nha Trang are extremely gloomy.
At the present time when the epidemic is under control, the number of tourists to Da Nang is increasing sharply. According to data from the Da Nang Department of Tourism, in the first six months of 2022, tourism indicators have grown significantly with the number of visitors to accommodation establishments serving in the first six months of the year estimated at more than 1.32 million. turns, up 33.6% over the same period in 2021. Revenue from accommodation and travel services is estimated at VND 3,185 trillion, pushing the 6-month revenue growth up to 54.3%. Many tourist areas and attractions received a large number of tourists, increasing many times over the same period in 2021.
As a result, the tourism-resort real estate market in Da Nang is also on the upswing. Particularly in the hotel apartment segment, the market no longer recorded the situation of selling at a loss as during the pandemic. A series of apartment and hotel projects developed strongly from Son Tra peninsula, along the Hoang Sa – Truong Sa – Vo Nguyen Giap sea route are being offered for sale quite actively.
However, the selling price did not increase significantly on the secondary market but was mainly offered at the same price as the owner. Trading in the market has also increased again. A survey with floors showed that, with the hotel apartment segment, depending on the project, location, and transaction, on average, transactions increased by about 30% over the same period last year.
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