Week 03/2022 – Central Vietnam Real Estate News Summary
In this weekly or sometimes bi-weekly news flash – CVR: Central Vietnam Realty will provide a choice of articles from mainly Vietnamese media sources related to the real estate market in Vietnam.
We will be focusing on issues related to Da Nang and Hoi An, while also looking at national news and their possible impact on Central Vietnam’s property market.
You will find a summary, a link to the source as well as CVR’s take on the article.
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1. Looking back at the real estate market in 2021
In 2021, the COVID-19 epidemic and prolonged blockades have had a serious impact on the real estate market. However, the market still has many bright spots, notably the increase in real estate prices in many places, by 5-9% on average, especially in the land plot segment. The main reason is due to the scarcity of supply, while the demand for real estate is still very large.
Cheap money is continuing to flow into the market, making the demand to buy real estate for living and investment continue to increase in 2021.
The demand for real estate search always increases again after each wave of COVID-19.
A remarkable point is that the cash flow into real estate is moving more and more clearly from the South to the North.
The supply is scarce while the demand for housing in the market is very large, which inevitably leads to an imbalance between supply and demand and pushes up real estate prices.
2. Claiming a lower property value in a transaction trick is no longer possible
The Ministry of Finance proposed the Ministry of Public Security, the Ministry of Justice, and the General Department of Taxation to coordinate with localities in investigating and strictly handling acts of business and real estate transfer with signs of tax evasion. At the same time, request notarial practice organizations to guide people and project investors to declare on contracts according to actual purchase and sale prices.
The Ministry of Finance proposed the Ministry of Public Security to direct local police agencies to coordinate with Tax Departments to investigate and strictly handle acts of business and real estate transfer with signs of tax evasion in order to deter and prevent tax evasion. blocking and collecting taxes for the state budget.
Along with that, it is proposed that the Ministry of Justice, People’s Committees of provinces, and centrally-run cities direct the Departments of Justice to closely coordinate with local Tax Departments to request notarial practice organizations to guide people, Real estate project investors, real estate business and transfer enterprises declare on the notarized contract according to the actual purchase and sale prices, to serve as a basis for the tax situation as prescribed by law, to avoid losses for the state budget revenue.
The Ministry of Finance said that cases of transferring real estate with the declared price on the contract lower than the actual transfer price is a tax violation and will be handled in accordance with the law.
Importance: With the new execution of the policy against tax evasion, the government will have more tax payments for the national treasury.
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3. Is the real estate market no longer “hot” as a result of credit tightening?
The State Bank of Vietnam (SBV) strictly controls credit in potentially risky areas such as real estate investment and business in 2022, which will contribute to preventing speculation and inflation but cannot “cut” the hot fever. of the market right away.
“Tightening” real estate credit: Recently, the State Bank issued Directive No. 01, which directs one of the key tasks of the banking industry in 2022 to not relax credit-granting conditions; continue to strictly control credit in potentially risky areas such as investment, real estate business, securities.
According to many real estate experts, Directive No. 01 of the Governor of the State Bank will certainly have a strong impact on the real estate market and be an important factor in “cooling down” the real estate fever taking place across the country. Experts also said that although the level of interest in real estate in December 2021 unexpectedly decreased along with the directive 01 of the Governor of the State Bank, many investors were more hesitant to participate in the market, but “real estate fever” can not “cool down” immediately.
Thanks to the rapid vaccine coverage in all provinces and cities along with the strategy of opening the economy to live with the epidemic, the frequency of activities of real estate investors will be wider, so in 2022, suburban real estate will rise and “fever”.
Why it is important: It is useful information for investors to consider about the investment real estate channels.
CVR is here to help you understand the trends of the market so you can make the best investment decisions. Our experience, highly regarded reputation and strong legal knowledge keep us at the forefront of the real estate industry. Interested in learning more about opportunities in Central Vietnam? Contact the CVR team today!
4. Proposing the planning of a national railway connecting Kon Tum to Da Nang
That is the content of the draft Da Nang City Plan for the period 2021 – 2030, which has just been consulted by the city of Da Nang for relevant local opinions.
On January 19, 2022, Mr. Le Tri Thanh – Chairman of Quang Nam Provincial People’s Committee signed Official Letter No. 433/UBND-TH to the People’s Committee of Da Nang City on commenting on the draft Da Nang City Planning for the period of 2021 – 2030.
Accordingly, the People’s Committee of Quang Nam province said that the draft investment proposal to strengthen the transport system connecting Da Nang city with Hoi An city (Quang Nam) by the iron-wheel tram system, however, the route has not yet been confirmed.
Therefore, the People’s Committee of Quang Nam province requested the People’s Committee of Da Nang city to coordinate with the consulting companies to determine and clarify the alignment so that the two localities have a basis for coordination and proactively deploying joints in construction planning projects. To build, have a tentative plan of land fund for technical infrastructure, management of route corridors, intersection points with traffic axes and parking stations, etc.
In addition, the draft also proposes a national railway connecting Kon Tum to Da Nang but has not yet proposed a route. Regarding this content, the People’s Committee of Quang Nam province also proposed to clearly define the route plan, the connection point when passing through the territory of Quang Nam province.
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!
5. Real estate integrates into the wave of market digitization
Although it is still in its infancy, the proptech (property technology) market in Vietnam is considered to be rich in potential and attractive to investors, with a young population structure and frequent use of technology and the size of the real estate market is expected to reach 21 billion USD, so proptech in Vietnam has many ideal conditions for development and exploitation.
Digitizing real estate in Vietnam is also a trend of many large corporations and businesses through the investment or acquisition of proptech startups. According to statistics, in Vietnam, proptech is currently developing with 56 companies and many startups continuing to launch in the near future. Among them, up to 80% of proptech platforms are foreign companies or capitalized from foreign investors.
Experts believe that digitization brings benefits in controlling land and project information… to ensure the transparency of information about real estate products.
This is one of the solutions that should be considered after a series of land fevers occurred in the past. Land prices were pushed up just because of the lack of accurate information. One of the solutions that need to be taken into account in the establishment of a National Data on Land Prices – where all information about land is stored on a digital platform.
Why it’s important:
Thanks to the application of technology, searching, comparing, trading… becomes more convenient, flexible, fast, and economical.
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