Land auctions are "hot" again, experts advise avoiding making the same mistake

The auction land market is bustling

Recently, the land auction market in many localities has been bustling. Typically, land auctions in Bac Giang have continuously increased in temperature and have been in a "sizzling" state for the past month.

Most recently, the land auction in Tan Yen district in early June attracted hundreds of customers to participate with nearly 700 applications. As a result, 84/87 lots were successfully auctioned. Most of the winning lots increased, pushing the total price of the 84 lots to more than 130 billion VND, nearly 55 billion VND higher than the starting price.

Also in Tan Yen district, last May, a series of auctions were successfully held. There were some that "shocked" many people, such as the auction in Ngoc Thien commune which attracted nearly 1,000 visitors, 66 plots of land were sold out, the highest land price difference was over 1.2 billion VND.

An auctioned land plot in Me Linh district, Hanoi (Illustration photo: Ha Phong).

Similarly in Hanoi, information from the People's Committee of Dong Anh district said that in the first quarter, functional units successfully organized 6 auctions of land use rights, collecting about 800 billion VND for the budget. Most of the auctions attracted great attention from investors.

Previously, according to the first quarter real estate market report of the Ministry of Construction , after the Lunar New Year holiday, some areas had a slight increase in selling prices and quite active transactions. The organization of land auctions in new urban and residential areas has been implemented by localities more than in the same period in 2023.

The Ministry of Construction assessed that the fact that localities organize many land auctions is also considered a factor that can help the land market become more vibrant in the coming time.

The Ministry of Construction also said that the land market in Ha Nam in the first quarter recorded many positive signals in transactions with the land segment priced at about 2 billion VND/plot thanks to newly approved planning, favorable location adjacent to Hanoi and strong investment in infrastructure.

Similarly, the Hai Duong real estate market has flourished with many new projects and a high absorption rate of up to 100%. Accordingly, projects with guaranteed legal status, available infrastructure and utilities have recorded a price increase of up to 40% compared to the same period last year.

Be careful in bargaining

The common point in localities with bustling land auction activities in recent times is often the areas with new infrastructure planning. A series of information about districts becoming districts or the implementation of traffic routes such as Ring Road 3.5, Ring Road 4... in Hanoi has been attracting special attention from investors.

In fact, there have been a series of cases where investors who won land auctions had to forfeit their deposits. Most of the reasons stem from the auction winners not being able to fulfill their financial obligations as prescribed.

From the investor's perspective, "abandoning deposits" is due to the winner paying a high price when the market is "hot". But when the market is quiet, liquidity and "surfing" are not possible, causing investors to "abandon deposits".

According to real estate experts, auctioned land has clear legal advantages, with a red book and available infrastructure after the auction. However, investors need to be careful to avoid repeating the mistakes of the past.

Auctioned land has a stable supply, meeting the practical needs of buyers for residence or long-term investment. However, auctioned land must be priced appropriately, closely following the market price. It is impossible to use the winning price when the market is "hot" to still apply when the market is still fluctuating as it is now.

Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Realtors (VARS), said that the sharp increase in real estate prices in the context of the economy not really escaping from difficulties, only showing signs of recovery, and people's incomes still not stable is a sign of abnormality, a bubble. It is possible that a group of speculators created confusing information, pushing up market prices for profit.

Therefore, according to Mr. Dinh, buyers need to be alert and choose products carefully before making a decision. Absolutely do not rush into virtual fevers to avoid unnecessary risks.

Source: https://dantri.com.vn/bat-dong-san/dat-dau-gia-nong-tro-lai-chuyen-gia-khuyen-cao-tranh-di-vao-vet-xe-do-20240610105819947.htm