Real estate developers in final rush

Real estate developers double efforts to secure sales as the market is heating up

Last week, CapitaLand launched 200 units in the Orchid building, the best building of Vista Verde, with more than 100 units registered to buyers.

According to Nguyen Thuy Duong, director of Marketing and Business of South CapitaLand, more than 100 units were sold at the launching ceremony, confirming the allure of the real estate market in the eastern areas of Ho Chi Minh City. Located at an ideal venue in District 2, Vista Verde is expected to produce high profit, with the price increasing by 30 per cent since the end of 2014.

Meanwhile, another domestic developer, Vingroup, has been continuously pushing its projects. Among these is Vinhomes Central Park in Ho Chi Minh City, with thousands of units on offer.

Vingroup has also announced its new partnership with Saigon Port to develop a 32-hectare prime site at the Khanh Hoi port waiting to be removed in District 4 in the eastern area of the city.

Dai Quang Minh Real Estate Company has also introduced two new condominium projects in District 2 to the market last week. The Sarica Condominium and Sadora Apartment projects will offer combined 780 units to the market. Those projects will be finished in mid-2017.

In the third quarter of 2015, positive market momentum continued, boosting new launch activities and sales performance.

According to CBRE Vietnam, a total of 10,114 new units were launched from 26 projects, triple the number seen in the same period last year. By location, new supply from the south, encompassing districts 4, 7, 8, and Nha Be, accounted for 36 per cent of the total newly-launched stock, while the recent hot spot in the east (districts 2, 9, Binh Thanh, and Thu Duc) accounted for a more modest 29 per cent this quarter.

“The market is believed to witness more competition between these two hot zones in the coming time, especially in the context that the Thu Thiem new urban area in the east has begun development, with the first condominium blocks, called Sarimi, being launched in the third quarter of 2015,” said Dung Duong, director of CBRE Vietnam’s Research and Consulting.

The review quarter also witnessed a repackaging of some long-delayed projects where new developers have taken over and revitalised developments by providing more finance or redesigning the unit layout, size, and mix.

These projects include City Gate Towers (District 8), Linh Tay Tower (Thu Duc district), and C.T. Plaza Nguyen Hong (Go Vap District).

CBRE Vietnam commented that overall, market sentiment remained relatively positive despite the “ghost month,” with good cash inflow from buyers.

An estimated 7,862 units were sold during the quarter, signifying an increase by 88 per cent year-on-year. Continuing the trend from last quarter, high-end apartments still account for an increasing share of units sold.

For the first nine months of 2015, high-end apartment sales accounted for 35 per cent, up from the 32 per cent reported at the end of 2014.

However, cautiously looking at the sales performance of new launches in the third quarter of 2015 showed an absorption rate of 35.1 per cent, partly due to the fact that buyers lack confidence in suspended developments.