News & Events

News & Events | 18-08-2021

HO CHI MINH CITY APARTMENT MARKET REDUCES SUPPLY

The decline in the supply of apartments while the high housing needs keeps the absorption rate at a good level, especially in potential districts like Binh Tan.

From late 2020, the real estate market experienced a shortage of new supply. According to data from the Ministry of Construction, in the second quarter of this year, there were only 69 licensed commercial housing projects nationwide, equal to 73% compared to the previous quarter and about 21% over the same period in 2020.

Decline in supply

This situation was even more evident in the apartment segment in Ho Chi Minh City. According to CBRE, total supply offered in the market in the first half of 2021 was 5,600 units, 9% lower than the same period last year.

In which, in the second quarter of 2021, the sales momentum was evaluated by CBRE as relatively good compared to the previous quarter, with more than 80% of the offered units already sold. A total of 4,700 units were sold, an increase of 76% compared to the first quarter of 2021.

Besides, despite the 4th outbreak of the epidemic, real estate prices did not decrease. CBRE Vietnam reported that the average selling price in the primary market increased in all segments, reaching USD 2,260 per square meter, up 16.5% compared to the same period last year. The luxury and mid-end segments recorded a high price increase of 9.2% and 8.3%, respectively, over the same period last year.

In this regard, Ms. Duong Thuy Dung - Senior Director of CBRE Vietnam evaluated that the outbreak of Covid-19 changed the nature of the housing business in a positive way and the market remained attractive.

"Investors have renewed their sales policies while buyers are increasingly getting used to the new normal state. Vaccine visa and improved vaccination rate will help foreign visitors return to the market," Ms. Dung emphasized.

Opportunities for the market in West Saigon

The supply is scarce, but the real estate needs in Ho Chi Minh City have been still high. This current situation is evident in West Saigon, especially Binh Tan - the most populous district in the city with more than 780,000 people, adding 28,000 to 35,000 people each year. As calculated, within the following 5 years, the population of Binh Tan district will reach one million people, leading to quite high and diverse needs for buying houses, renting houses for residence and profitable investment.

The analysis department of Viet Dragon Securities Corporation (VDSC) evaluated that Binh Tan district had many development prospects with its large area, large population and strategic geographical location in the west of Ho Chi Minh City.

Thị trường căn hộ TP HCM giảm nguồn cung
Infrastructure in Binh Tan district is completed with many large and airy roads. Photo: Hung Thinh Land

Momentum of the development of real estate is the strong transformation of infrastructure. Binh Tan has currently had enough infrastructure such as commercial center (Aeon Mall Binh Tan), supermarket (Go!, Co.op Mart), recreation area (Galaxy cinema), chain of convenience stores benefits (Circle K, Vinmart). The system of hospitals and schools has been also gradually improved, such as: Trieu An Hospital, Minh Anh International Hospital, City International Hospital, Kindy City International Kindergarten, Southeast Asia Kindergarten...

Traffic projects with a value of trillions also raise the bar for Binh Tan real estate, with projects such as metro line 3A Ben Thanh - Tan Kien station, metro No. 6 Ba Queo - Phu Lam roundabout and arterial traffic routes: National Highway 1A, Vo Van Kiet Boulevard, Trung Luong Expressway, Ten Lua, Kinh Duong Vuong, Nguyen Cuu Phu, Hong Bang... West Bus Station - the main bus station to the Mekong Delta provinces is also located in Binh Tan, creating favorable conditions for residents to move to the western provinces.

A real estate expert commented that in addition to the convenient location and easy traffic, Binh Tan is also the only district in Saigon with two industrial parks, namely Tan Tao and Vinh Loc. There are a lot of foreigners living and working in this area, especially the Chinese community...

In which, the most developed and convenient area in Binh Tan district is Ten Lua area, Binh Tri Dong B ward. This place has currently "changed its look", becomes one of the most highly appreciated areas in terms of living environment. Since 2016, when Aeon Mall Binh Tan was officially put into operation, the real estate prices around Ten Lua area has tended to increase every year.

Aeon Mall Bình Tân
Aeon Mall Binh Tan has pushed up the prices of Ten Lua area’s real estate. Photo: Aeon Mall

The area is planned with many parks, green roads, creating a cool and fresh living environment. According to some real estate brokers, if the South Saigon area has the Phu My Hung urban area, the East has Thao Dien, the West of Ho Chi Minh City has the Rocket area, all of which are worthy places to live in the city. This is also an area that attracts many wealthy people to build villas, creating a civilized and modern living environment.

Ms. Nguyen Anh - a resident in the West of Ho Chi Minh City highly appreciates the chessboard planning model in Ten Lua area, because it helps facilitate traffic in all directions without worrying about traffic jam.

"The area is close enough to industrial parks but still has a relative distance to ensure a safe, civilized, cool and convenient living environment," said Ms. Nguyen Anh. Despite of convenient living environment, spacious traffic and very high housing needs, the area has still lacked mid-range apartment projects to meet the needs of residents. For example, a project at the center of Ten Lua area offered in 2019 with the price of VND 45 million per m2 were sold out, while the distribution floor that allowed non-refundable deposit transferred with the difference from VND 30 to VND 100 million per unit. Thus, it can be seen that this area is thirsty for housing projects with a financial level of VND 3 to VND 5 billion.

Thị trường căn hộ TP HCM giảm nguồn cung
Perspective of Moonlight Center Point project - The central apartment of Ten Lua area has just been launched to the market. Photo: Hung Thinh Land

In response to this scarce supply situation, many enterprises have quickly grasped the increasing demand and participated in the development of projects here, typically Moonlight Center Point apartment project in the center of Ten Lua area developed by Hung Thinh Land. It is known that the project has been attracting the attention of a large number of investors and real residential buyers. Moonlight Center Point is deployed on a scale of 1.9ha, including 4 apartment blocks with 24 floors and a variety of areas.

"The project owns a prime location, adjacent to Aeon Mall Binh Tan, enjoying a series of expensive utilities of the area. Inside Moonlight Center Point, there are many modern internal utilities including 2 sky pool swimming pools, internal park, walking path, multi-purpose sports field, gym, kindergarten, children's play area and outdoor BBQ area...The project will be a suitable settlement choice for young families or investors who are looking for profitable products", a real estate broker said.

Theo thesaigontimes.vn

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