Vietnam real estate market 2024 overcomes challenges

Experts believe that 2024 could be the last year in the process of "overcoming obstacles" of the Vietnamese real estate market, the market will gradually stabilize and become more and more positive. On January 5, under the direction of the Vietnam Real Estate Association (VNREA), the Vietnam Association of Real Estate Brokers (VARs) organized the Forum: "Vietnam Real Estate Market 2024" (VREF 2024) with the theme "Overcoming Challenges". The forum attracted the participation of many managers, experts, leading speakers in the fields of economics, real estate, finance...; domestic and international investors, focusing on discussing and sharing views on the real estate market situation in 2023 and analyzing the potential, forecasting the development prospects of the market in 2024 and factors attracting cash flow into real estate in the coming time. According to the "Vietnam Real Estate Market Report 2023 and Forecast 2024" of the Vietnam Real Estate Brokers Association, 2023 is a "difficult" year for the Vietnamese real estate market. It can be said that 2023 is the year of the "outbreak" of the "difficult" disease of the Vietnamese real estate market, after a long "incubation" period and showing signs of "onset" since May 2022. This is also the year of the outbreak of difficulties in the Vietnamese real estate market, after a long "incubation" period and showing signs of onset since May 2022. It is an opportunity to recognize too many loopholes in the development of the real estate market, from mechanisms, policies to the implementation process. Speaking at the opening of the Forum, Dr. Nguyen Van Dinh, Vice President of the Vietnam Real Estate Association, President of the Vietnam Real Estate Brokers Association, commented that 2023 is a challenging year for the real estate market, however, thanks to the participation of the Government, ministries, branches and localities, a significant part of the limitations and obstacles of the market have been resolved. "Although there are still many difficulties, the Vietnamese real estate market has passed the most "frustrating" period. A survey on the market shows that the number of searches and transactions in the land and apartment segments... has recovered well and the supply from new projects is showing signs of increasing again. Along with the signs of recovery of the market, the confidence of customers and investors is increasingly strengthened. The goodwill of investors is evident through the application of a series of unprecedented preferential policies. Towards the end of the year, the supply is improving, increasing the choices for customers and investors", affirmed Dr. Nguyen Van Dinh. Also according to Dr. Nguyen Van Dinh, in 2024, the real estate market will have many intertwined opportunities and challenges. In particular, positive movements in both total supply and total demand have been recorded thanks to planning information. The participation of investors in the "race" to develop affordable housing and social housing will also gradually narrow the gap between supply and demand. In the coming time, the development of social housing will continue to have more positive results with "support" from policies. The passage of the new Housing Law (amended) with many new regulations to "remove difficulties" for buyers and investors developing social housing projects is expected to create attractiveness, attracting more businesses to participate; at the same time, contributing to increasing the accessibility of low-income people and policy beneficiaries to social housing. According to Director Hoang Hai, real estate is an important industry in the economic ecosystem and is directly related to many other industries. However, from 2022, especially from mid-year until now, the real estate market has encountered many difficulties due to the general context of the world economy as well as Vietnam, which is in the process of recovery, but is facing difficulties due to limitations and shortcomings that have not been completely overcome. According to the representative of the Department of Housing and Real Estate Market Management, in the face of the above difficulties, the State management agency and experts have made many analyses and grouped the difficult subjects that the market is facing, including: Institutional group, bond group, capital - credit group and implementation group. On that basis, many mechanisms and policies have been issued by the Government: Decree 10/2023/ND-CP removes the need to grant pink books for types of real estate such as resort apartments, offices combined with resort; Circular No. 02/2023/TT-BTNMT of the Ministry of Natural Resources and Environment on Certificates of land use rights, house ownership rights, and other assets attached to land and amending and supplementing a number of articles of Circular No. 24/2014/TT-BTNMT dated May 19, 2014 regulating cadastral records. Decree 08/2013/ND-CP removing obstacles for the offering and trading of corporate bonds; Circular 02/2023/TT-NHNN restructuring debt repayment terms and maintaining debt groups to support customers in difficulty; Circular 03/2023/TT-NHNN on credit institutions and foreign bank branches buying and selling corporate bonds; Circular 10/2023/TT-NHNN creating conditions for customers to access credit more conveniently; Regarding construction activities, Decree 35/2023/ND-CP removes difficulties and obstacles from practice while waiting for new laws to take effect. Regarding planning: Decree 58/2023/ND-CP details a number of articles of the Law on Planning... In addition to perfecting institutions, the Prime Minister's Working Group on reviewing, urging, and guiding the removal of difficulties and obstacles in the implementation of real estate projects for localities and enterprises has received 138 documents reporting difficulties, obstacles and recommendations related to 191 real estate projects. The Working Group and the Ministry of Construction have reviewed, classified and transferred them to competent authorities for handling. Although there are still difficulties, the level has gradually decreased, most clearly shown in the Ho Chi Minh City market. In order for policies and solutions to be effective as expected, more time and more participation from ministries, branches, and localities are needed. Therefore, I think that organizing today's forum is very useful to listen to opinions from experts, scientists, and real estate businesses as a basis for research and perfecting policy institutions in the coming time" - Director Hoang Hai emphasized. Presenting at the Forum, a representative of the VARS Market Research Team said that 2023 is a "difficult" year for the Vietnamese real estate market. This is the "price" for the uncontrolled, opaque and unsafe development of the market over a long period of time. According to the General Statistics Office, in 2023, 1,286 enterprises were dissolved, an increase of 7.7% compared to 2022 (in 2022, it increased by 38.7% compared to 2021), 3,705 real estate enterprises temporarily suspended, an increase of 47.4%. Meanwhile, the number of newly established real estate enterprises reached 4,725, a decrease of 45%; 2,270 enterprises returned to operation, an increase of 9.1%. Regarding the general situation of the whole market, the supply in 2023 shows a shortage and poverty when the total supply in 2023 only reached 55,329 products, although an increase of 14% compared to 2022, but only 32% compared to 2018, the time before the Covid-19 pandemic. The signal has improved in the second half of the year, but in general, 2023 is a difficult year for the real estate market in general, and brokerage activities in particular, when thousands of real estate brokers lost their jobs and quit their jobs. Up to now, only about 20% of real estate brokers are still operating. According to the forecast of the VARs Market Research Group, 2024 will be the last year of the "overcoming obstacles" process of the real estate market. Although it is difficult to "explode", the market will gradually stabilize. VARs' research team assessed that, in essence, this change is not development, but an effort to move towards the starting line, instead of existing in a "negative" state like the recent period. However, this will be the basis and foundation for the market to prepare for a new development cycle that is more stable, sustainable and effective. When the market recovers, in 2024, the real estate industry will welcome the return of about 30 - 40% of brokers. Along with that, large-scale sales programs and massive media campaigns will take place more frequently and continuously.

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