Strict Requirements and Tough Credits Harm Real Estate Activities

Diep Nguyen

14:47 09/04/2019

BizLIVE -

Hanoi and Ho Chi Minh Cities are the two main drivers of the Vietnam national real estate market, the slumps in those two markets show that the real estate really slows down compared to the past several years.

Strict Requirements and Tough Credits Harm Real Estate Activities

Photo: Bloomberg

Recently, Bizlive in cooperation with VTV24 organized the conference to sum up the new changes in the real estate market in the first quarter of 2019 and predictions for the second quarter 2019.
Nguyen Van Dinh, Vice President of Real Estate National Association of Realtors said that the real estate activities in the first quarter of 2019 were very low, he shared the same opinions with other specialists and economists in the conference. 
According to what Nguyen got for the real estate market in the first quarter, in Hanoi, there were 5,206 real estates of all kinds were put on sale, the number of successful transactions was 3,200, the absortion rate was much lower than the last quarter of 2018. In Ho Chi Minh city, 3,274 real estates were put into the market and in which 3,000 transactions were carried out successfully.
Hanoi and Ho Chi Minh Cities are the two main drivers of the Vietnam national real estate market, the slumps in those two markets show that the real estate really slows down compared to the past several years, especially 2017 and 2018. In this year, the real estate market activity was also lower than the same period last year and the final quarter of 2018.
Nguyen pointed out that the real estatle supply precisely reflects the market. Currently, there is really supply from the projects, however, most of them do not meet the requirements to be put on sale.
Nguyen thinks that the state agencies are giving out so many hindrance to the real estate market activities. The approval of the real estates is taking too long time and relate to too many parties. This explains why the real estate transactions are being pushed to the surrounding areas of Ho Chi Minh City like Long An, Binh Duong, Dong Nai, Bien Hoa. 
In Hanoi, transactions were not so slow down like Ho Chi Minh city but the speed is much less than before. Currently, the system is under the reassessment process. There used to be the frenzy of the market and now is the adjustment time to leave out the under standard projects. The adjustment process is taking place throughout the country. Real estates in Hanoi and Ho Chi Minh cities are both reducing introducing new products to the market.
Ministry of Construction announced that in Ha Noi and Ho Chi Minh cities, there are only about 3,000 and 1,000 products meeting the standards to be put on sale. Tougher credit requirements are also creating hurdles for the market.

DIEP NGUYEN

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