Investors and experts expect that the real estate market will begin recovering in the fourth quarter of 2023 a...
Investors and experts expect that the real estate market will begin recovering in the fourth quarter of 2023 as policies continue to ease difficulties, demonstrating absorption and a positive impact on the market.
Experts all commented favorably on the optimism of the real estate market. Photo: Gia Mieu
According to the market research report for the third quarter of 2023 recently published by market research companies, the apartment market in Ho Chi Minh City is witnessing an influx of new supply in the apartment segment, showing the revival of the market.
New supply and new sales mainly come from products in the Eastern area, specifically from The Glory Heights, Thu Thiem Zeit River, and Metropole Thu Thiem - The Opusk, equivalent to 92% of total sales in the quarter.
Notably, in some newly launched large-scale projects in this quarter, investors have offered many flexible payment methods and incentives to attract buyers, notably the extended payment plan lasting up to 7 years.
At this point, the question that investors are most concerned about is when the real estate market will recover.
Experts from Savills Vietnam analyze that since the beginning of 2023, the Government has taken various initiatives to support the real estate market.
The Ho Chi Minh City People's Committee has focused on resolving issues for 148 projects, with 39 projects showing results. The State Bank of Vietnam (SBV) has continuously lowered interest rates and Circular 10 is expected to bring better access to capital for ongoing projects.
These mechanisms are expected to help increase supply and stimulate market development. In the first 9 months of the year, the Government has issued dozens of resolutions, decrees, and circulars, along with many meetings with localities, leading real estate associations, and businesses to find solutions to these market’s challenges. This has contributed to "breaking the ice" in the real estate sector when liquidity begins to show improvement in some segments towards real demand.
From his perspective on the real estate market, Dr. Can Van Luc believed that the Vietnamese economy is showing signs of recovery.
Vietnam's economic growth forecast this year is expected to achieve good results, from 5 to 5.5%. The growth rate for the following year is projected to be around 6.5%. Besides, inflation and interest rates are no longer rising and are gradually decreasing. Inflation, as of August, has maintained a level of 4.57%. As of September 1, the overnight interest rate decreased nearly as much as at the beginning of 2021, below 1%; the re-discount interest rate is 3%; and the refinancing interest rate is 4.5%.
Also according to Dr. Can Van Luc, legal and institutional obstacles are gradually being removed and enforced. Public investment and infrastructure development are being strongly emphasized. The real estate market structure is becoming more rational, and property prices are becoming more balanced and appropriate.
According to experts from VNDirect Securities Company, compared to the period 2011-2013, real estate businesses now have better financial health, significantly lower leverage ratios, healthier and faster payment ratios, and higher loan repayment capacities.
Regarding policy openness, in the previous period, the market was in a state of oversupply and inflation was at a very high level, causing tighter operating policies. For now, the limited supply of projects helps stabilize inflation. This provides the basis for the real estate market to expect faster penetration of supportive policies.
Dr. Can Van Luc also mentioned that currently, the market has been recovering about 20-30%. In the future, the market will perform even better.
The first quarter of 2024 will be a turning point as interest rates decrease, the 4 laws passed by the National Assembly in October will take effect, leading to better policy absorption at that time.
According to Labor Newspaper