The outlook for Vietnam’s real estate industry in 2022 is expected to be positive as the market is receiving many impulses.
For instance, of the total economic stimulus package for the years 2022 and 2023 (445,760 billion VND) as proposed by the research team of the National Assembly's Economic Committee, up to 150,000 billion VND is invested in infrastructure. In addition, the Government and the National Assembly have also agreed on a package of about 60,000 - 65,000 billion VND for housing development. According to experts, these factors will have a direct impact on real estate prices.
Dr. Can Van Luc, Chief Economist of BIDV, assessed that both macro and micro factors will promote a better recovery of the real estate market in the period 2022 - 2023.
Firstly, Vietnam's economy is forecasted to recover at a positive level, growing at 6 - 6.5% or even 6.5 - 7% if the recovery program is well implemented. Demands will then bounce back strongly.
The housing development strategy has been prepared by the Ministry of Construction and is about to be submitted to the Government for promulgation in the near future. In particular, infrastructure investment is being promoted.
Besides, inadequacies in the legal environment will solved. For example, Decree 148 on land, Decree 69 on renovating old apartment buildings and 10 other laws will be revised in the coming time by the National Assembly. The Land Law is also expected to be revised next year.
According to this expert, last year, despite being heavily impacted by the COVID-19 pandemic, the market was still considered an attractive investment channel.
In particular, real estate prices hardly decreased, in contrast, prices of residential real estate also increased by 5-9%, depending on the location. The main reason is that in the past 2 years, there have not been many products while demand has been on the rise.
Mr. Luc assessed that the capital poured into real estate in 2021 was basically positive. Specifically, by the end of the third quarter of 2021, real estate credit increased by about 6% compared to the end of 2020 and it is expected to grow by about 7-8% for 2021, lower than the industry average but still a very positive level.
Total real estate credit balance is about 2 million billion VND. In the first 11 months of 2021, the total newly registered FDI in real estate reached nearly 2 billion USD (accounting for about 11%). In addition, by the end of November, businesses have issued about 436,000 billion VND, of which, real estate enterprises ranked first when accounting for 45% of the issuance proportion.
Capital inflows into real estate are still on the rise. In the context that Vietnam is promoting public investment, the implementation of a series of down-scale projects will create a driving force for the real estate market to continue to grow strongly.
"It is forecasted that in the period of 2021 - 2025, the total public investment capital will reach 2.87 million billion VND, expected to reach 95% disbursement, higher than 75% of the 2016 - 2020 period. In that context, businesses must be more flexible." said Mr. Luc.
Regarding the price trend, Mr. Luc said that real estate prices will slow down for a while after a relatively rapid increase. House prices in Hanoi in the past year have increased somewhere between 5-7% and Ho Chi Minh City by about 7-9%.
"In the first half of next year, it is expected that prices may level off, but then there will not be a decline in house prices like some countries in the world. Because Vietnam's business investment environment is very attractive and the demand for real estate is still quite large, especially industrial and residential real estate" he said.
Sharing the same view, Senior Director of CBRE, said that in the coming time, the upward trend in prices will continue for the apartment market in Hanoi and Ho Chi Minh City.
Specifically, apartment prices will increase by about 3-7% depending on each segment in 2022. Particularly for the high-end and luxury segments, the price may increase by about 5-7%. As for the affordable and mid-end segments, the price may increase by about 3-5%.
This company forecasts that next year the apartment market will receive twice as many projects as in the first nine months of 2021. Similarly, the supply of the land-attached housing market is forecast to grow by about 20 - 30%.
Compiled by VietnamCredit