Apartment launches break year-long silence

March 01, 2018 | 11:00
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In 2017, the Ho Chi Minh City real estate market was poised to grow thanks to vibrant transactions, but in reality, many projects were delayed by red tape. The market is expecting a different scenario in 2018.
apartment launches break year long silence
In 2018, the market will welcome more new projects with water-related amenities

Lack of supply in 2017

According to research by CBRE Vietnam, the supply of new apartments in Ho Chi Minh City in 2017 went down by 20 per cent from 2016. The demand, on the other hand, remained robust with a slight decline of 5 per cent year-on-year. 2017 was also the first year since 2012 when the sold apartments outnumbered those put on sale during the year.

Even Hung Thinh Corporation, known as “the king of apartment distribution” in Vietnam, only launched three projects called Moonlight Boulevard (Binh Tan District), Richmond City (Binh Thanh District), and Lavita Charm (Thu Duc District) during the entire year. The total number of apartments from these three projects was 2,000—and all of them have been sold within a short time.

On the contrary, Novaland Group, which manages 40 major projects, did not introduce any new projects to the market in 2017. The developer previously planned to launch at least four new apartment buildings last year.

Similarly, Him Lam Land Corporation, one of the leading developers in the south, only unveiled one project named Him Lam Phu An in District 9, with more than 1,000 units.

Other high-profile developers, such as Dat Xanh Real Estate Service & Construction Corporation, Phuc Khang Construction and Investment Corporation or An Gia Investment stayed silent during the entire year.

According to Tran Khanh Quang, CEO of Viet An Hoa Real Estate Investment JSC, the bureaucracy related to new projects was quite cumbersome. In 2017, regulations were tightened, which means many developers got stuck in complex legal procedures. This caused delays in launching new projects.

Another reason for the lack of new supply on the real estate market is the on-going inspections at some projects. This is especially true for 60 projects located on land previously managed by state-owned enterprises (SOEs). During the equitisation process of these SOEs, local authorities were strict in investigating the intended usage of the land, some even requested a temporary halt to construction works during the inspection.

A boom in high-quality supply

It is true that the market did not see much action in 2017. However, industry insiders expect the market to spring back to life this year, as new apartments finally find their way to the market.

Right at the start of 2018, the Ho Chi Minh City real estate sector has already witnessed a slew of new projects. For example, after the success of Dragon City in Saigon South, Phu Long Real Estate Co., Ltd. has expanded its grip to the east of Ho Chi Minh City by launching Dragon Village on Nguyen Duy Trinh Street, District 9. Dragon Village, which spans an area of 21.6 hectares, is intended to become a compound area with 24/7 security, apartments, and villas.

Similarly, right at the start of 2018, Novaland has launched Victoria Village in Dong Van Cong Street, which is near the main road Mai Chi Tho in District 2. Victoria Village consists of four towers, each 25 storeys high and having one basement. Apart from 900 apartment units, the project also has 92 villas built in the Victorian architectural style. The developer has confirmed a number of other new projects scheduled for 2018.

Dat Xanh also recently announced that it would launch 10,000 apartment units in 2018. Specifically, the new supply will come from four major projects, including Gem Riverside in District 2 with 3,100 apartments in 12 towers; Opal City in District 9 with 3,500 apartments in eight towers; Opal Premium in Thu Duc District, with 4,247 apartments across 10 towers; and Lux Riverview in Saigon South.

Hung Thinh is also gearing up for new product launches. Nguyen Nam Hien, CEO of Hung Thinh Land, revealed that the developer will launch approximately 10,000 apartments in 2018, 4,000 of which will be introduced in the first quarter via a project in District 7. Another project in the east of the city, with 3,000 apartments, will also be put on sale soon. Hien said that all of these projects are ready to go on the market.

Smaller developers are also launching apartment complexes this year. For example, Dream House Investment Corporation (DRH Holdings) is ready to sell 500 apartments in Aurora Residences at 277 Ben Binh Dong Street, District 8. The developer will introduce Dream Home Riverside in District 8 as well.

Meanwhile, Hung Loc Phat Real Estate Service JSC will launch Green Star in the Phu My Hung township in District 7, consisting of 100 villas and 1,000 apartment units.

In the east of Ho Chi Minh City, Daewon-Thu Duc Housing Development Corporation will put on sale 544 apartment units at Centum Wealth. This project, which spans an area of 11,585sq.m, features three 20-storey high-rise buildings.

At the same time, Vingroup’s mega project called Vincity in District 9 is also ready to launch 30,000 apartment units on the market this year.

According to research done by most market consultants, the Ho Chi Minh City real estate sector has witnessed a hike in liquidity and prices. In the coming future, prices will not increase too much but the market should not expect any drastic declines either. It is a positive sign that most new projects are competing in terms of quality, promising a new era of high-quality products for homebuyers. If this is the case, then homebuyers will reap the greatest benefit.

By Tang Trien

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