Decoding real estate inventory data

Pursuant to Clause 1, Article 3 of Decree 44/2022/ND-CP, real estate inventory is explained as the quantity of real estate of a project that is eligible for transaction according to the provisions of law but has not been transacted in the reporting period.

What is the basis for determining inventory?

According to the latest report of the Ministry of Construction , the real estate inventory in projects in the first quarter of 2024 of 56 provinces and cities across the country is about 23,029 units (including apartments, individual houses, land), of which: apartments have 3,706 units; individual houses have 8,468 units; land has 10,855 plots. Accordingly, it can be seen that the inventory ratio is mainly in the individual housing real estate segment and land plots of projects.

The Ministry of Construction said there are currently 3,706 unsold apartments, but the actual number is much larger.

Mr. Vo Hong Thang, Director of R&D Department of DKRA Group, said that real estate inventory is understood as the number of products in real estate projects that have not been successfully traded.

According to Mr. Thang, the inventory data is based on data reported by real estate enterprises under Clause 1, Article 3 of Decree 44/2022/ND-CP. According to the Decree, real estate inventory is the quantity of real estate of a project that is eligible for trading according to the provisions of law but has not been traded in the reporting period.

The reporting period will be conducted quarterly and the investor will report project information and transaction status (including real estate inventory information) according to Forms No. 10 and 12 attached to Decree 44/2022/ND-CP.

In which, form No. 10 includes information and data on real estate projects and real estate products eligible for transactions; Form No. 12 includes information and data on the real estate transaction situation of the project.

Reality is different from data

Real estate businesses believe that the inventory data announced by the Ministry of Construction is not really accurate. Mr. Ha Van Thien, Deputy General Director of Tran Anh Group Real Estate Corporation, said that currently, the businesses reporting inventory data are listed on the stock exchange.

Unlisted real estate companies will only report in their annual financial statements. There is even unconfirmed information about how real estate companies "dodge" the problem, that some investors have not sold their products so they let their employees buy the products in their name, then borrow money from the bank to have cash flow. When there are customers buying these products, the company will settle the loan with the bank to sell to actual customers, so the product is still considered to have been successfully opened for sale, but in reality, it is still inventory. Therefore, the published inventory data may not be accurate.

According to Mr. Thien, the actual inventory is larger than the reported figures, because the number of real estate businesses not listed on the stock exchange is very large, these businesses have a large number of projects in the provinces and the amount of goods sold lasts for many years.

For example, in Binh Duong , there are many apartment projects that have full legal documents, however, the number of products sold is very low. Specifically, Danh Khoi Group with the Astral City project, the project has 4,966 apartments, opened for sale since 2020, however, only about 40% of the above products have been sold. Le Phong Group has 3 projects for sale with full legal documents and is in the process of handing over houses in 2 projects, the number of unsold products is nearly 1,000 units...

In addition, Binh Duong currently has dozens of projects that have been opened for sale for a long time and are almost completed, but investors are still offering inventory for sale. Meanwhile, according to the Ministry of Construction, the market currently has an inventory of about 3,706 apartments. Thus, it can be seen that the data is very different.

Or in Ho Chi Minh City, in 2023, although there are few projects for sale in the market, the quantity of goods is not small. For example, the MT Eastmark City project in Thu Duc City, with nearly 2,000 apartment products, sold from 2021 to now, is still being opened for sale by the investor. The project in District 1 of Novaland Group, sold from 2019 to now, still has unsold goods, the apartment project in Binh Chanh district of An Gia Group, although handed over, still has a large amount of inventory... However, in early 2024, the Department of Construction of Ho Chi Minh City reported that Ho Chi Minh City currently has no inventory.

In addition, a story about inventory that needs to be mentioned is that after a difficult financial period from 2022 until now, many customers who ordered real estate products but did not have enough financial capacity had to return the goods to the investor, so this amount of inventory is also quite large.

In addition, basing on Clause 1, Article 3 of Decree 44/2022/ND-CP applied to projects eligible for trading according to the provisions of law to calculate as inventory is also a problem.

For example, in Ho Chi Minh City, there are currently many projects that have been opened for sale, built, and handed over to customers, but have not met the legal conditions for transactions, so the investor and the customer have only signed a deposit contract to hold the place, even though they have collected up to 95% of the value of the house. And these projects, because they do not meet the legal conditions, are still considered unformed projects and cannot be counted as inventory if the products are not sold out.

Source: https://baodautu.vn/batdongsan/giai-ma-so-lieu-hang-ton-kho-bat-dong-san-d219682.html