The real estate market is in turmoil, with underlying unusual factors.

(Dan Tri Newspaper) - Experts assess that the real estate market is recovering, but slowly and unevenly across segments and locations, and still harbors some unusual factors.

Prices are rising too rapidly.

According to a report from the Ministry of Construction , apartment prices in Hanoi have increased sharply in the past quarter, with a quarterly increase of 4-6% and an annual increase of 22-25% for new projects. Notably, the selling prices of older apartments have also increased significantly, in some areas by as much as 35-40% compared to the previous quarter.

BIDV 's chief economist, Mr. Can Van Luc, commented that the real estate market is recovering but unevenly and harbors many potential irregularities.

He stated that from 2019 to the present, real estate prices have increased by 50-70%, mainly in the apartment and land segments, due to a shortage of supply.

Mr. Luc also pointed out that housing loan credit is increasing slowly, only one-third of the credit for real estate investment, indicating that house prices remain high, making people hesitant to borrow to buy a house. He recommended that businesses consider adjusting selling prices to a more reasonable level.

According to experts, recently adopted new land and housing policies (such as the Resolution on the real estate market and social housing, piloting special mechanisms and removing obstacles for projects, piloting the implementation of commercial housing projects through agreements on land use rights or existing land use rights, etc.) are expected to bring significant changes to the market.

However, despite policy adjustments, home ownership remains a difficult challenge for Vietnamese people, especially the younger generation.

Commenting on recent apartment prices, Ms. Nguyen Hoai An, Senior Director of CBRE Hanoi branch, said: "This is almost the first time that apartment prices in Hanoi have increased so rapidly in such a short period."

According to her, historical analysis shows that over the past 10 years, Hanoi apartment prices have increased by an average of 5% per year. Even in the period 2009-2019, apartment prices fluctuated little, there were periods of price reduction and an average increase of only 2% per year. From 2022 until now, apartment prices in this city have only begun to increase rapidly.

According to real estate expert Le Dinh Chung, the upward trend in real estate prices is inevitable. However, the sharp increase in real estate prices over a very short period is unusual.

An apartment building in Hanoi (Photo: Tran Khang).

"The main reason for the high real estate prices is that although supply has improved, it is still very scarce compared to demand. The high investment costs have made investors have higher expectations for profits," said Mr. Chung.

Identifying the "complicity" of speculation

Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Real Estate Brokers (VARS), assessed that apartment prices have increased unusually recently, especially in Hanoi.

He believes that this phenomenon is certainly influenced by vested interests while the economic context, market conditions, and people's incomes have not yet recovered. "House prices are rising sharply, but transactions are not frequent. This could be some kind of trick by a group of investors with ulterior motives," Mr. Dinh frankly assessed.

According to him, these interest groups are able to carry out price manipulation schemes because of the fact that the supply of apartment units is problematic. In recent years, the market has not seen any new projects approved for investment.

The projects on the market are mostly old projects that have been bought and resold. The supply is both insufficient and of poor quality, with very little supply for the general public and low-income earners, and the product structure is unsuitable.

According to Ms. Pham Thi Mien, Deputy Director of the Vietnam Real Estate Market Research and Evaluation Institute, in addition to results stemming from actual supply and demand, the market has also shown signs of overheating. This situation is manifested through land speculation, inflated housing prices, and the emergence of opaque real estate transactions.

Many small-scale investors enter the market with the aim of short-term speculation, causing real estate prices to be pushed up unreasonably high. This "overheating" is also evident in the apartment segment, with increasingly high asking prices for resale apartments, facilitated by certain speculative groups.

Source: https://dantri.com.vn/bat-dong-san/thi-truong-bat-dong-san-day-song-tiem-an-yeu-to-bat-thuong-20241211164653693.htm