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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Your Friends at Central Vietnam Realty.
OCTOBER 2022 CENTRAL VIETNAM REAL ESTATE NEWS SUMMARY
1. Da Nang will auction 14 large plots of land
The People’s Committee of Da Nang City has just issued Decision No. 2745/QD-UBND approving the list of land funds for the auction of land use rights in the city (phase 2) in 2022.
The list of land funds for the auction of land use rights in the city (phase 2) in 2022 includes 14 large land plots.
Specifically, the Complex of Trade Center – High-class Apartment at the land lot A-1 belongs to the Resettlement Area project at the end of the Bach Dang Dong route, Nai Hien Dong ward, Son Tra district. This land lot has 3 facades located on Le Van Duyet, Ho Han Thuong, and Bui Duong Lich. Area 11,371 m2, is the land unit of combined commercial and service.
Production and business land at lot B4-2, belonging to Tho Quang storm shelter and boat anchoring project, Tho Quang ward, Son Tra district. Area 1,480 m2; production and business land.
Kindergarten land at lot A2-2 belongs to the Southern Residential Project on Bui Ta Han Street, Khe My Ward, Ngu Hanh Son District; area 1,480 m2; Kindergarten land.
Commercial and service land at lot A1-14 belongs to the C-KDC South Cam Le bridge, Hoa Xuan ward, Cam Le district. This land has 4 street frontages, including: Nguyen Xuan Lam, Doc Lan, Le Quang Dinh, Huynh Xuan Nhi. Area 4,224m2 is commercial and service land.
Commercial and service land at lot A2.11 belongs to Zone E project (phase 2) – Residential area South of Cam Le bridge, Hoa Xuan ward, Cam Le district. This land has 4 street frontages: Hoang Dinh Ai, Tran Nam Trung, Le Quang Dinh, Nguyen Xuan Lam. The land area of 3,618m2 is commercial and service land.
The land for the construction of a kindergarten at lot A8 of the Expanded Area E – Residential Area South of Cam Le Bridge, Hoa Xuan Ward, Cam Le District; The land area has 3 fronts of Con Dau 4, Con Dau 6, and Con Dau 7 streets. Area 2,278m2, is the land for building a kindergarten.
Commercial and service land at the corner of Le Dai Hanh – Nguyen Phuoc Tan street, Hoa Phat ward, Cam Le district, land area with 3 fronts of Le Dai Hanh, Nguyen Phuoc Tan, Doan Nguyen Thuc streets. This land is commercial and service land, with an area of 1,585m2, the purpose of the use is commercial and service land.
Hoa Xuan Sports, Entertainment and Commercial Complex Project, Hoa Xuan Ward, Cam Le District; area 349,000m2, is commercial and service land.
Commercial Center Area (supermarket) in the Southeast area of Student Dormitory, Hoa Khanh Nam Ward, Lien Chieu District; land area with 4 frontages Nguyen Sinh Sac – Le Doan Nha – QH 10.5m and QH 5.5m. Area of 19,197m2 is commercial and service land.
The commercial and service land area in the commerce and service lot belongs to the project of Area No. 2 of the new Northwest urban center, Hoa Minh ward, Lien Chieu district. This land has 2 fronts of Hoang Thi Loan and Dang Minh Khiem street, an area of 804m2, commercial and service land.
In addition, Da Nang auctions land to build markets and parking lots. Accordingly, Hoa Phuoc Wholesale Market project, Hoa Phuoc commune, Hoa Vang district, with an area of 309.229m2, is commercial and service land.
Land plots for parking purposes include: Parking lot at the acquired land of A Long Food Joint Stock Company, Hoa Tho Dong ward, Cam Le district; at 383 August Revolution, an area of 3,094m2. Smart parking at land 172 Nguyen Chi Thanh, Phuoc Ninh ward, Hai Chau district; land with 2 street frontages: Nguyen Chi Thanh and Thai Phien; 1,653 square meter area.
And the project of a park, a public parking lot in combination with trade and service at the land area A3 Nguyen Van Linh, Phuoc Ninh ward, Hai Chau district; land area with 3 fronts of Nguyen Van Linh, Phan Chau Trinh and Le Dinh Duong street 3,111 square meter area.
Danang is also home to some of the most stunning luxury resorts in the country. CVR can help you find suitable real estate projects that fit your specific needs whether it’s from international chains to boutique properties. Contact CVR today!
2. Ha Noi to launch 8 new real estate developments that allow foreign ownership
Organizations and foreigners living in Hanoi have the opportunity to buy 8 new real estate projects in Hanoi, according to the latest decision from the Hanoi Department of Construction.
In Bac Tu Liem district, it is the N03-T3&T4 High-rise Housing Project, Ngoai Giao Doan area. The project is invested by Vietnam Engineering and Construction Joint Stock Company, and the low-rise housing project in plot TT6-2 belongs to the detailed planning of Tay Tuu urban functional area, Tay Tuu ward, invested by JSC Xuan La as an investor.
Nam Tu Liem District has a project of a mixed-use area for services, houses, kindergartens and parks, 55 K2 Street with the investor called Hanoi Transformer and Electrical Materials Manufacturing JSC.
Long Bien District, including the project of a high-rise apartment building, blocks HH4 and HH5, belonging to Khai Son City project, invested by Khai Son JSC; and Project to build high-rise housing for sale in plot CT7, invested by Long Bien Construction Investment Joint Stock Company.
Hoang Mai District, Apartment project NO-02, NO-04 belongs to the low-rise housing project and resettlement area combined with commercial, invested by Linh Dam Real Estate Investment Co., Ltd.
Tay Ho District has a high-rise apartment project combining commercial services and low-rise housing at plot CT02A in Nam Thang Long urban area, invested by Sunshine Sky Villa JSC; and a Low-rise housing project in plot TT6-2 under detailed planning of Tay Tuu urban functional area invested by Xuan La Construction Investment Joint Stock Company.
Importance: With the quota of 30% of all products to foreign ownership, the above projects will provide adequate accommodation for foreigners who stay and work in Ha Noi.
With invaluable local and regional market knowledge, an extensive professional network, and an up-to-date database of properties for sale, our team of experts will guide you through every step of the homebuying process. Whether you are interested in an apartment, condo, or single-family home, the CVR team will help you find a property that works for you. Contact our sales team today!
3. Difficult to access bank capital, real estate market is in danger of freezing
Some commercial banks have increased deposit interest rates after the State Bank raised the operating interest rates earlier. High-interest rates, people will deposit money in banks, and limited cash flow into real estate. On the other hand, when lending interest rates increase, investors using financial leverage are unable to repay their loans and will be forced to sell real estate to cut losses.
According to the leader of a real estate business, if the interest rate increases, the real estate business will bear the most difficulties and risks. Since the real estate business itself, when operating mainly on bank loans, the homebuyers themselves also have to borrow money, so the real estate market will suffer double effects.
In the past, the housing market has been negatively affected many times in each rising interest rate cycle with the first stage often having many investors because they could not stand the pressure, so they had to sell and cut losses quickly, then the market would fall into a quiet phase, frozen for a long time.
The increase in deposit interest rates of banks will attract a lot of deposits. However, this will not be good for the real estate market.
The real estate market is slowing down, transactions are difficult, and many people are still stuck. Bank interest rates increase, and real estate loans will make investors consider.
Our expert knowledge of both the property market and business environment ensures our clients are provided the best advice throughout the process. In today’s constantly changing market, buyers face an array of complex challenges and new opportunities. We can help!
4. The exchange rate of USD on the “black market” is extraordinarily high
On the domestic currency market, on November 3, the central exchange rate was listed by the State Bank at 23,687 VND/USD. The reference rate at the State Bank’s Transaction Office is at 24,870 VND/USD, unchanged.
At Vietcombank, the exchange rate is listed at 24,562 – 24,871 VND/USD. At Vietinbank listed at 24,585 – 24,871 VND/USD.
Along with the increase in the USD price of commercial banks, on the free market, the USD price was pushed up sky-high.
Survey of Tien Phong in Ha Trung street, Hanoi – where the trading of USD is free, the USD price is exchanged at 25,225 – 25,400 VND/USD. In addition to buying and selling at the gold store on Ha Trung Street, these units also receive delivery and exchange of USD at their own homes. With a transaction of 10,000 USD or more, stores deliver USD to customers’ homes for free.
Why it is important:
US Dollar appreciation in terms of real estate will be more beneficial for customers who are using USD because the higher the exchange rate to Vietnam dong, they will spend fewer dollars when buying or renting real estate.
For example: Previously to buy a villa costing 25 billion, they would spend about 1,077,000 USD. But now to buy this villa they only spend about 1,000,000 USD only. Thus, from an investment perspective, this investor can save about 77,000 USD.
5. A wave of cutting losses may occur in Ho Chi Minh Real Estate Market
Due to the use of large financial leverage (usually up to 50-70%), the investor’s tolerance is limited, at a point when they can’t stand it, he may have to “discharge”, or even accept ” sell at a loss ” to preserve the remaining capital.
According to experts, the real estate market has seen a situation of “continuously increasing house prices” in the last 5 years. The affordable house price (about 2 billion VND back, less than 30 million VND/m2) is also about 20 times higher than the average income of the people, this number is only 6-7 times in advanced countries, so it is difficult for middle-income people, laborers and immigrants to have the opportunity to own houses if the State does not have supportive policies.
From 2019 til now, there have been “super luxury” real estate projects and apartments with prices up to 500 million VND/m2, especially with prices up to 1 billion VND/m2.
According to the association, currently, although the real estate market has shown signs of “deceleration”, slowing down, real estate transactions have decreased by more than 50% depending on the project and the region, but housing prices are still “anchored at high prices” because businesses and investors expect the market to improve in the last months of the year (before the Lunar New Year). But also due to the use of large financial leverage (usually up to 50-70%), so the stamina is limited to a point of unbearable, one may have to “discharge”, or even accept “sell at a loss” to preserve the remaining capital.
Importance: Cutting loss will benefit the real buyers as they will have the chance to buy real property and this will prevent the speculation of real estate property. This leads to the sustainable development of the market.
Not everybody wins the game of land investment. It would be better to do investment with well-inform projects which have adequate paperwork and choose those which had the pink book issued. A stronger and more transparent market means more opportunities! Considering investing in a new construction development project in Central Vietnam? Contact the CVR team for more information on current and upcoming opportunities.
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