Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, affirmed this at the seminar New Opportunities of the Real Estate Market , organized by Nong Thon Ngay Nay and Dan Viet newspapers on August 1 in Hanoi, right at the time when the three laws on Land, Housing, and Real Estate Business came into effect.

The apartment bubble will burst.

According to Mr. Dinh, apartment prices have increased but there have not been many actual transactions. This could be due to a group of dishonest speculators pushing up prices.

"The reason for the unusual increase in apartment prices in Hanoi is partly due to a serious shortage of supply, with no new projects, only old projects being implemented.

"With both weak supply and poor quality, the demand for affordable housing is high but the market supply is non-existent. Even the demand for real estate investment is not met due to lack of supply," Mr. Dinh added.

He hopes that in the coming time, many projects will be resolved, and the market supply will be more abundant and more diverse. This will reduce the gap between supply and demand and reduce the pressure on price increases in the market.

Forecasting the price of apartments in Hanoi in the coming time, Mr. Dinh said that from now until the end of the year, the Hanoi market will have many new apartment projects appearing, and there will be several thousand more products from new projects.

As for selling prices, any area that has recently seen a bubble will definitely deflate and prices will decrease. But the general trend is that apartment prices will not drop when market input factors such as land prices and compensation for site clearance increase.

Besides, project licensing is not as easy as before. Only qualified investors can do projects. When supply and demand gradually balance, apartment prices will be determined by supply and demand.

The three laws come into effect, will localities no longer be afraid of making mistakes?

At the seminar, many experts and managers commented that with the clear legal provisions of the three laws that have just come into effect, the problems of hundreds of real estate projects will be resolved. Local officials will no longer be afraid of making mistakes when carrying out procedures to resolve problems for each project.

According to Mr. Dao Trung Chinh - Director of the Department of Planning and Land Resources Development, Ministry of Natural Resources and Environment, the early approval of 3 laws (Land Law, Housing Law, Real Estate Business Law) will resolve a series of problems, including problems in land valuation and implementation of land financial obligations.

Mr. Chinh shared that since the promulgation of the 2003 Land Law, there were projects that had been stuck for 20 years without being resolved. When the 2013 Land Law was promulgated, many localities were stuck because they could not determine land prices. Many local officials were afraid of making mistakes and did not dare to do anything. The 2024 Land Law, which has just come into effect, will solve these problems.

Mr. Le Van Binh, Deputy Director of the Department of Land, Ministry of Natural Resources and Environment, said that it is necessary to clarify whether the current difficulties of real estate projects are due to legal policies that make the projects impossible to implement, or because the implementation process is not in accordance with regulations.

"I think the second part is more problematic. If we do it sequentially and in accordance with regulations, we must have an investment project, select an investor, and proceed with land allocation. After the decision to allocate land is made, we must complete financial obligations before being able to allocate land in the field, be granted a certificate of land use rights, and then build the project.

But many projects in the past did not follow the steps in order. As soon as the land allocation decision was made, the project was mortgaged. The land was built and sold before financial obligations were completed. That is because it was not done correctly," Mr. Binh emphasized.

Sharing the same view, Mr. Nguyen Quoc Hung, Vice President and General Secretary of the Vietnam Banking Association, also emphasized the need to clarify whether the current difficulties of many projects are due to mechanisms or not due to improper implementation of processes and procedures. Problems with procedures cannot be fixed because they are not in accordance with legal regulations.

Mr. Hung also admitted that in the past, there were difficulties due to errors from the businesses themselves, the mechanism, and even from banks lending to projects without sufficient legal documents, leading to a large amount of backlog assets.