Week 25/2024 – Central Vietnam Real Estate News Summary

1. 
   

   1. It Is Still Good Time For Home Buyers To Buy Property.

2.  

1. Mr. Tran Khanh Quang, an experienced real estate investor, notes that current market conditions are favorable for home buyers due to adjusted prices and ongoing incentive programs expected to last until 2024. Despite predictions that opportunities to buy houses at good prices would diminish by the end of 2023, the Ho Chi Minh City apartment market still sees efforts to increase liquidity. Many investments offer two-year payment plans and substantial discounts to attract buyers.

2.  

   Quang highlights that this is a good time to purchase a home, especially in the apartment segment, which caters to practical housing needs with extended payment policies. Lower real estate loan interest rates, strong public investment disbursement, and attractive sales policies from investors create a buyer-friendly environment. He stresses that while primary apartment prices in Ho Chi Minh City are still rising, the growth rate has slowed. This period benefits real estate buyers, especially those looking for long-term investments, as the market conditions currently favor them over short-term investors.

3.  

Source: cafebiz.vn

2. 4 Out Of 6 Real Estate Segments In Da Nang And Surrounding Areas “Lack” New Supply.

In May 2024, the Da Nang and surrounding real estate market experienced a significant lack of new supply across several segments, causing market stagnation. According to DKRA’s Real Estate Market Report, there was no new supply in 4 out of 6 segments, including apartments and all three types of resort real estate. Apartment transactions were limited to Ngu Hanh Son and Son Tra districts, with stable primary sale prices. Projects in central locations along the Han River, developed by reputable investors, garnered interest.

The resort real estate market, including villas, townhouses/shophouses, and condotels, saw no new supply despite tourism recovery signs. Legal issues and delayed sales by developers contributed to this stagnation. The report predicts ongoing difficulties for the resort real estate market due to an unclear legal framework, low liquidity, and declining investor confidence.

Land plot and townhouse/villa markets recorded new supply but few transactions. New supply and consumption of land plots fell sharply by 55% and 68%, respectively, compared to May 2023. A single project offered 10 plots, with only 2 sold in Nui Thanh District, Quang Nam, priced at around 13.7 million VND/m2.

Da Nang and Thua Thien Hue faced a scarcity of new supply with stable primary prices. The townhouse/villa segment introduced 18 new units, just 21% of the previous year’s level, concentrated in Da Nang and Thua Thien Hue, with Quang Nam remaining scarce. Market demand was low, and liquidity significantly decreased, with most transactions in older, legally complete projects priced below 5 billion VND/unit. Primary sale prices remained flat, with developers continuing to offer banking support, interest rate incentives, and principal debt grace periods.

Source: diaocnet.vn

3. Pilot Construction Of Commercial Housing Through Land Use Right Agreements.

The Ministry of Natural Resources and Environment is drafting a Resolution to pilot commercial housing projects through agreements to receive land use rights or existing land use rights that are not residential land. The draft outlines criteria for selecting projects, including alignment with district land use plans, local housing development programs, and approval from provincial People’s Committees. Projects must also comply with legal requirements related to land, housing, real estate business, investment, and other relevant laws. The pilot aims to address practical difficulties, revitalize, and promote the real estate market. The Ministry proposes two options for project selection, with preferences for urban areas, state-allocated land, and relocated facilities due to pollution or urban planning.

The Ministry emphasizes the necessity of the Resolution to overcome legal obstacles encountered by many housing projects under current Land Laws and the Housing Law. The existing legal framework, which restricts commercial housing projects to land with residential use rights, has hindered the progress of numerous projects. By introducing this pilot, the Ministry aims to implement the Party’s policies on developing the land use rights market, enhancing the commercialization of land use rights, and resolving practical issues to revitalize and stimulate the real estate market. The draft is a response to the challenges faced by 579 commercial housing projects, with 493 encountering legal issues related to land use under current regulations.

Source: cafef.vn

4. Some Important New Regulations On Land Valuation According To The 2024.

The 2024 Land Law in Vietnam has abolished the land price framework and will now implement annual land price tables. Previously, the government set a land price framework every five years, which local authorities used as a basis for their pricing. The removal of this framework means the government will no longer set minimum and maximum land prices. Instead, provincial People’s Committees will create land price tables based on various factors including market fluctuations.

Historically, there have been two land prices: one set by the government for tax and compensation purposes, and a higher market price. The new law aims to address this discrepancy by introducing new land valuation methods:

Comparison Method: Adjusting prices of similar land based on market transfers and auction results after excluding the value of assets on the land.
Income Method: Calculating based on average annual net income divided by the average interest rate of 12-month VND deposits in state-controlled commercial banks over the past three years.
Surplus Method: Subtracting estimated development costs from estimated development revenue for the highest and best use of the land.Adjustment Coefficient Method: Multiplying the land price in the price table by an adjustment coefficient determined by comparing table prices with market prices.

The government may also introduce additional valuation methods with approval from the National Assembly Standing Committee.

Source: cafef.vn

5. Veteran Actor Robert De Niro Comes To Vietnam With The Two Co-founders of the Nobu Hospitality Project.

On June 18, 2024, Nobu Matsuhisa, Robert De Niro, and Meir Teper, the renowned founders of Nobu Hospitality, visited Vietnam at the special invitation of real estate developer Bản Việt (VCRE). They participated in exclusive events with media and top experts in Ho Chi Minh City.

Vietnam is one of the few Asian countries visited by all three founders. The event highlighted natural exchanges between Henry Nguyễn, Chairman of Phoenix Holdings, and the Nobu founders, discussing the formation of Nobu, their collaboration with VCRE, and the potential growth of branded residences in Vietnam.

This visit underscores the strengthening Vietnam-U.S. business ties, particularly in the luxury real estate sector with projects like Nobu Danang and Nobu Ho Chi Minh City.

Source: elle.vn

1. 1. As always, CVR is at your service and happy to provide help anyways we can!

       

      Contact Us today to find the real estate investment in Da Nang that is right for You.