Is HCM City real estate market really hot?

VietNamNet Bridge – The real estate market is showing different price performances. While the medium and high grade segments have not shown signs of recovery, land priced at VND10mil/sq m seems to be increasing.

Hoang Anh Gia Lai group, a real estate developer, has announced a 40% reduction on its apartments at Hoang Anh River View and Phu Hoang Anh projects. Meanwhile, Dat Xanh Company has launched a programme on slashing apartment prices for the Sunview project. The price of apartments, which was announced previously at $1,300/sq m, has been slashed to $764/sq m, down by 42%. Moreover, Dat Xanh has also announced 4% bank interest rate support for the buyers of apartments.

The market of transferred apartments (buyers can move in right after paying money) is also cool now. For example, Hoang Anh Gia Lai 2 apartments are going for VND15-17mil/sq m.

Meanwhile, the prices of project land in some areas have been rising. The land price in district 9 has risen by VND500,000-1mil/sq m, or even VND2mil, as the sellers target people who have to leave their homes for site clearance within the Thu Thiem new urban area project.

When asked if the real estate market is really heating up or not, no one dares say anything for certain. They say that the phenomena in the market recently show that the market is recovering. However, if considering the conditions of the national economy, they are not sure if this will continue.

It seems that the market now has favouorable conditions for recovery. However, investors and those who have idle capital are not joining the market just yet.

Analysts say that investors will remain cautious about investment decisions because they have learned lessons from what happened in July 2008.

After a long time of freezing, the real estate market suddenly warmed up in July 2008. The land price in South Saigon urban area at that time rose significantly, by VND1-2mil, in just one week. This made investors think that the market would recover quickly and they began making investments. However, they were wrong: The land price is dropping again, just one month later.

Though no one can say for sure if the market is really heating up or not, they all say that there will not be any big changes with the market. People have every reason to believe this: Real estate companies are trying to lower sale prices of their products to boost sales. If the companies keen on the field believed that the market would warm up soon, they would not be offering products at low prices.

VietNamNet/LD