"Hoarding goods" waiting for price increase

Owning 3 plots of land of nearly 200 square meters, Mr. Manh (residing in Binh Chanh) said that he had stopped entrusting real estate companies and removed the sale ads on online trading floors to wait for the market situation at the end of the year. Also with these 3 plots of land, Mr. Manh had advertised a loss of nearly 20% in 2023 but could not find a buyer. However, when the market "warmed up" in early 2024, some customers came to "force the price" too low compared to the market, so the transaction was not yet made.

"Because the market has started to improve, many new laws have officially come into effect and the new land price list is close to the actual market price. Although the current selling price is higher than the previous purchase price, after deducting the loan interest and bank settlement, the current selling price does not make much profit, so I have temporarily stopped selling and will consider it again at the end of this year," Mr. Manh shared.

Similarly, Ms. Ngoc (Hoc Mon) is also having to reduce most of the land for sale to wait for the market to recover strongly, 3 other residential land plots of 60m2/plot still have to be sold to get money to pay off the previous bank loan. At the end of 2023, Ms. Ngoc also wanted to sell these plots of land at a loss of over 1 billion VND/plot but could not find customers. Up to now, many customers have come back to ask to buy at a higher price, but because the Hoc Mon land price list has just been adjusted to increase sharply, the sale has not been successful.

"With the new land price list, it is expected that the supply and selling price in this area will be affected for a while. Therefore, I am not in a hurry to sell right away to wait for the fluctuations of land prices in the coming time," said Ms. Ngoc.

Landowners "hoarding" and withdrawing their land use rights due to the new land price list and expecting the impact of the laws are also happening in many areas in Ho Chi Minh City. Sharing about the market at this stage, Mr. Quang Anh - a real estate broker said that many landowners are selling at prices 20-30% higher than at the beginning of the year, partly because they do not want to sell and partly to wait and see what the market is like.

Although the current demand has not shown any signs of fluctuation, the suspension of sales by many landowners is expected to increase due to the chain effect. Especially the tightening of subdivision and sale of land plots, causing the market to go through a period of supply shortage and strong price increase.

Market recovers slowly at year-end

Commenting on the market after the new laws come into effect, the Vietnam Association of Realtors (VARS) believes that during the "soaking" period, the real estate market will continue to recover slowly and sustainably, with gradually improving results. By the end of the year, the recovery process of the real estate market will have clear progress. The recovery results will continue to be differentiated by segment and region, but with a more even level of differentiation.

In the housing segment, based on the new Laws taking effect soon, the Government, Ministries, sectors and localities are constantly "making every effort" to promote the recovery of the real estate market, project development enterprises will "release products" with more bustling communication activities. The demand for buying houses for living will continue to remain high along with investment demand recovering by about 30% compared to the beginning of the year and moving towards new markets with much room for price increases, ... will promote the number of transactions to continue to increase.

Particularly for villas/townhouses, townhouses, transactions and supply will also improve broadly, especially in the secondary market, thanks to the previous recovery foundation and investors' expectations of higher profits.

In particular, the type of land is predicted to escape the bottom of the price decline, gradually becoming the king investment channel sought by many investors. However, in the coming period, investors will only focus on auctioned land, subdivided land lots, in areas with completed infrastructure, and prices that are not too high.

According to VARS's forecast, the land market in Ho Chi Minh City will recover strongly, continuing to play a role as a potential type in the real estate investment market. However, in the short term, the supply of this type will also be strongly affected when the temporary suspension of "selling" by landowners is gradually becoming a trend. In some markets, there are more buyers than sellers and the demand for cheap land will cause transactions to not achieve the desired results.