REAL ESTATE TRANSACTIONS ARE STILL SLUGGISH

After a series of mechanisms and policies from removing legal difficulties to banks reducing interest rates, the real estate market is still quite gloomy.

The newly published report of Dat Xanh Services Economic - Financial - Real Estate Research Institute (DXS - FERI) shows that in the residential real estate (real estate) segment in the third quarter of 2023, there are about 38,000 primary products. was launched on the market, but up to 90% came from existing projects and concentrated mainly in the North with about 14,000 products and the South with about 17,500 products. However, the absorption rate is quite low, only reaching 10%-20% of the total supply.

In the land segment, Danh Khoi Group said that in the third quarter of 2023, the Ho Chi Minh City market and surrounding areas only recorded 6 projects opening for sale with about 271 plots, equal to 21% of the same period last year. The consumption rate reached 25%, only 12% over the same period.

The new supply of townhouses and villas in the quarter was only 144 units launched for sale from 4 projects, only 5% compared to last year. The consumption rate is only about 28%, equivalent to 40 units. Most transactions focus on products priced below 10 billion VND/unit. According to Danh Khoi Group, general market difficulties, and macroeconomic fluctuations... have impacted customer psychology, causing sales transactions to not reach expectations.

A representative of Danh Khoi Group also said that recently, investors have had to extend the reservation time for open-sale projects to an average of 3-5 months, as well as continue the policies of quick payment discounts and extensions: payment deadlines, open-sale gifts... to stimulate market demand.

Sharing more to see that the absorption rate in the real estate market is still low, Mr. Neil MacGregor, General Director of Savills Vietnam, said that in a difficult market context, investors continue to maintain a cautious mentality. , limiting marketing activities and delaying plans to launch new projects until next year. Some investors with open-sale projects are forced to apply a series of preferential sales and diverse lending policies, along with new lease commitments to attract buyers.

On the contrary, real estate buyers are much more cautious, even though interest rates have dropped to the lowest level since 2020. A survey of customers about their intention to buy real estate if interest rates decrease due to Dat Xanh Services research showed that only 26% of people chose the answer "yes"; 31% responded "no"; 43% of people are "not sure".

Dr. Pham Anh Khoi, Director of DXS - FERI, said that all market participants now are in a "dilemma". The government must reduce interest rates to promote production and business, but must also balance to avoid affecting the exchange rate and the safety of the system. Production - business and service enterprises are also in the same situation, facing the situation of whether to borrow or not to borrow. Real estate businesses are both scarce in capital flow and facing market confidence that has not yet fully recovered. Thats why they choose to wait so liquidity is difficult to increase. "In the real estate industry, buyers often wait for the market to warm up before buying, but right now they dont have enough confidence. Real estate investment cannot turn capital quickly, and if you want to sell, you dont press the sell order immediately like stocks, so investors Investors will choose to wait to see the level of impact of executive policies. We predict that it will not be until the end of 2023 that the impact of the policies will be clearer" - Dr. Khoi acknowledged.

Cash flow is "stuck"

According to Dr. Le Dat Chi, Dean of the Faculty of Corporate Finance - at the Ho Chi Minh City University of Economics, there are many reasons to explain the low demand for real estate, which is impossible not to mention that the cash flow of many investors is being reduced. "stuck" in unfinished real estate projects, money has been paid but the house is not yet available; Many people stuck in corporate bonds have not found a way out. Therefore, for the real estate market to prosper again, it is necessary to resolve the issue of cash flow and confidence for investors...