According to Savills latest research, supply for the rest of 2022 will remain stable. The State Bank of Viet Nam (SBV) has tightened credit to real estate, which will make the market more sustainable in the long term, instilling a greater sense of confidence from all players.
Positive Outlook for 2022
While the real estate market faced challenges in H1/2022, including difficulties with capital inflow and available land banks, the outlook for the market for the rest of the year is positive. Ms Vo Thi Khanh Trang, Associate Director of Research, Savills Viet Nam, shared that the market expects new supply from large new projects.
“The primary supply is expected to increase in H2/2022, with the entry of 10,000 new apartments and 200 landed properties. Most apartments are outside of the core in District 7 and Thu Duc. There are only two new townhouse projects, and they are in Nha Be and District 9,” Ms Trang commented.
While supply in HCMC remains limited, neighbouring provinces like Binh Duong, Dong Nai, and Long An are benefitting and fulfilling some of the demand. Ms Trang noted that affordability is an issue in HCMC as apartment prices are considerably higher than the average income. Therefore, housing in neighbouring provinces is ideal for workers in HCMC looking to buy their own properties.
From an investment perspective, the country has reopened its borders and the market is thriving. With investors now able to travel to and within the country with ease and the creation of a more stable market, conditions for FDI inflow into real estate are favourable.
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Positive Outlook for 2022
Sustainable Real Estate Market
Ms Trang highlighted that the HCMC’s real estate market is facing challenges such as a shortage of land, low supply levels, high prices, and tightened restrictions for projects to gain licences.
She added that in the long term, the tightening of credit to real estate will result in significant changes that will make the market more sustainable and will ensure healthy development. Only developers and investors with good financial plans and sustainable development strategies will continue to exist. Tightening speculative lending will also create more opportunities for occupiers.
To curb the impact of the tightened lending, investors and developers should access alternative sources of capital through investment funds, M&A, and joint ventures. She added that diverse capital sources will lead to a more stable market with fewer systemic risks.
Conclusion
Are you looking for market research solutions to maximise your real estate? Savills Research provides comprehensive market research on a wide range of properties. We deliver detailed market insights, allowing you to make informed decisions. Contact Ms Trang today.
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