Batdongsan.com.vn has just released the results of a consumer psychology survey in 2022 with more than 1,000 participants. Accordingly, when asked about the forecast of real estate price fluctuations in 2023, only about 10% of respondents had the view that housing prices will decrease.
More than 84% of the remaining respondents said that real estate prices would continue to increase in the coming year. Among them, the proportion of people thinking that house prices would increase by 5-10% account for 40%; 23% think that the increase could be higher than 10% and only 17% think house prices would increase in a slight margin of less than 5%.
Similarly, a survey conducted with a group of real estate brokers in Ho Chi Minh City and Hanoi also found that 29% of brokers in Hanoi said that real estate prices would increase, 33% of which believed that prices might be flat. As for the Ho Chi Minh City market, 33% of real estate brokers believed that prices would increase, 29% thought prices might move sideways in 2023.
Talking about house prices in 2023, Mr. Dinh Minh Tuan, Director of Batdongsan.com.vn in the South, said that it is difficult for primary house prices to decrease in the context that all project development costs are increasing. In the 2012-2013 period, the market was in crisis due to overproduction, leading to a 20-30% drop in house prices.
However, in the current context, the biggest problem is the shortage of products for sale. There is no shortage of supply or demand, but on the contrary, the market's demand is still very large but the supply is scarce. Therefore, even if the liquidity is poor, it is still difficult for the primary price to reduce.
According to market report data by Batdongsan.com.vn, in the fourth quarter of 2022, the apartment consumption rate in Ho Chi Minh City recorded a record low of less than 25% (out of a total of 470 apartments for sale). Despite the sharp drop in liquidity, the selling price remained flat in the last 3 months of the year, even increasing by 3-4% compared to the first quarter of 2022. Particularly for townhouses in Ho Chi Minh City, the selling price in the fourth quarter of 2022 increased by nearly 16%, the price of private houses in many inner city areas even increased by 25-29% compared to the beginning of the year.
In a recent report, market research company Onehousing said that, despite the current difficulties in the market, the apartment segment is extending its price growth momentum, and this trend will continue in 2023. This unit forecasts that by the end of 2023, the average primary selling price in Hanoi is expected to increase by 8-9%/year, while the selling price may slow down in Ho Chi Minh City at 4-5%/year.
Mr. Tran Quang Trung, Sales Director of Onehousing, said that some of the important factors leading to the increase in the price of mid- and high-end apartments in the future is that there are almost no new approved apartment projects. During the past two years, there were almost no new projects, except for those that had been licensed.
However, with secondary market transfers, there will be more selling price reductions. Real estate prices will decrease when the pressure of loans from investors and speculators increases. Many investors who are trying to hold their goods in this period may find it difficult to bear more financial burdens in the near future, forcing them to consider a deep discount or sell at a loss. Secondary housing prices will tend to go down, but the drop will not be much because the supply is limited.
According to Mr. Nguyen Van Dinh, Chairman of the Vietnam Brokerage Association, the price reduction will only be recorded in some segments that have increased too much and in the segment that does not meet real demand. Segments such as mid-end, affordable apartments and real estate with good commercial exploitation value will still have transactions, so the possibility of lowering prices is faint, especially in the context of scarce supply.
Experts believe that there will be a change in the product development structure in 2023. Instead of focusing on high-end apartments, priced from VND 6-7 billion, businesses will adjust the shopping cart, aiming to develop products of about VND 2-3 billion to approach market demand and ensure sustainable liquidity.
According to Mr. Tran Khanh Quang, General Director of Viet An Hoa Company, in the current context, it is necessary to find solutions for the real estate market to transform into the affordable segment.
“The supply in the market is mainly for products that are not oriented to meet real demand and are redundant, wasteful. This shows that the existing supply is not reaching the people in need. Therefore, real estate developers should now balance and calculate the need to bring real-valued real estate to the market more than putting high-value real estate as beneficiaries." Mr. Quang commented.
Dr. Can Van Luc said that the real estate market is facing difficulties, but with rapid urbanization and high housing demand, the situation may soon improve. The confidence of homebuyers is decreasing, along with obstacles in the legal framework and scarce capital due to credit squeeze, which has led to a decrease in liquidity and an increase in construction costs. However, these difficulties may only be short-term when the housing demand in the next 10 years is still very large.
In terms of policy, the Government is giving a lot of support to social housing, worker housing and the mid-end segment. In addition, the Government continues to deploy many packages of capital support and public investment that are large enough. Therefore, businesses can still believe in the possibility of the market to recover in the coming period to constantly restructure.
Compiled by VietnamCredit