Ho Chi Minh City real estate market: Buyers and investors are waiting

The Government’s review of bond issuance and tight credit control policy have partly created the cautious sentiment of buyers and investors in the housing market in recent months.

This is explained in a report published on December 30 by the real estate services company Cushman & Wakefield, which has about 50,000 employees in more than 400 offices in 60 countries.

Overall, this year the real estate market recovered slightly after a pause in 2021 due to COVID-19.

In 2022, the Ho Chi Minh City apartment market recorded a total of 17,028 units for sale, an increase of 87% compared to 2021. Particularly in the fourth quarter of 2022, new sales reached 983 units, a decrease of 76% compared to the previous quarter. .

The average primary selling price (selling price of the investor) in the fourth quarter of 2022 increased by 21% compared to the previous quarter, about 3,400 USD/m2 (about 80 million VND).

This increase is mainly due to new sales from super luxury, luxury and high-end projects such as The Opusk Residence Thu Thiem (Metropole Thu Thiem phase 4), De La Sol and Zeit River Thu Thiem…

It is worth noting that health factors have begun to be focused in the design of projects and apartments with lots of green space, ventilation and modern technology to help raise living environment standards.

Regarding payment policy, with the credit tightening situation, many payment policies target the group of customers with cash in hand, mainly prioritizing quick payment with high discount and many incentives.

Regarding the townhouse market in Ho Chi Minh City, in 2022, the new supply will reach 1,200 units, up 12% year-on-year due to the market’s recovery compared to the quiet 2021 due to COVID-19.

Meanwhile, the number of units sold decreased by 3% due to the market sentiment slowing down and buyers hesitant in the context of uncertainty.

According to Cushman & Wakefield data, primary selling prices decreased slightly by 0.2% quarter-on-quarter due to some projects offering discount policies, but prices still doubled year-on-year as supply mainly came from from the high-end segment in prime locations.

First of all, about social housing, with about 2.5 million m2 of social housing floor will be developed for low-income people before 2025. Major developers involved in social housing development are Vinhomes, Hung Thinh.

The East and West continue to be the major contributors to new supply thanks to existing infrastructure improvements and upcoming infrastructure projects.

Investors offer flexible payment policies at the time of credit control along with incentive and discount programs to maintain sales.

For mid-end apartments, the demand is still very strong. Buyers prefer healthcare products and flexible payment schedules. Fast payment policies and high discount rates are also gradually being widely applied.

In 2023, due to limited development land fund and difficulties in raising capital, the new supply for the housing market is expected to be less than 900 units, down 27% compared to 2022.

Compared to previous projects, most new projects have more facilities with complete external and internal infrastructure.

It can be seen that the projects are built with the expectation that the house is not only a place to live, but also a weekend getaway between the river scenery and the fresh natural environment.

On the investor side, the report of Cushman & Wakefield found that projects focus on completing utilities, towards building community, with new supply continuing to move to non-CBD areas.

On the customer side, the market is moving towards real demand instead of buying investment as before. Projects with clear legal status and flexible payment schedule in the context of financial difficulties will attract customers.