The lack of supply has made the commercial townhouse segment quiet for the past 2 years. However, in the long term, this type is considered to be still attractive with high profit margin.
Profit from shophouse investment can be up to 12%
The lack of primary supply, few transfer transactions on the secondary market and the influence of the epidemic wave have made the shophouse market recently somewhat quiet. However, experts say that the quietness of this type comes from the general influence of the decline in the supply of commercial real estate in Ho Chi Minh City. In terms of liquidity, profit margin, the attraction of commercial townhouses is still very large.
Commenting on the market of commercial townhouses for rent, Mr. David Jackson, General Director of Colliers Vietnam shared, commercial townhouses occupy the most favorable locations for business in buildings, so they are very suitable for rental and working. shops, language centers or headquarters, offices of enterprises. Even in difficult times like during severe outbreaks of the Covid-19 pandemic, owners of shophouses can still earn revenue by converting functions, such as subleasing online businesses to providing online learning services, or online technology and fashion businesses...
High profit from business investment and transfer is a factor that makes commercial townhouses always in the group of products favored by investors.
“The profit from renting shophouse can now reach 12%/year. In addition, owners of shophouses, depending on their needs, can consider living options or using them for business purposes, which is very flexible. This type of investment is always one of the most powerful and sustainable investment rates in the market. This has also been proven by the market reality when the value of shophouse apartments can increase by 15-30% per year,” emphasized Mr. David Jackson.
Batdongsan.com.vn's NCTTT report shows that in the first quarter of 2022, the business of renting townhouses and commercial townhouses recovered positively. Accordingly, the demand for buying and renting commercial apartments in the podiums increased by 19% compared to the previous quarter. Particularly for Ho Chi Minh City, the demand for commercial real estate rental increased by 5%, especially for rental premises in apartments. The supply of this type in Ho Chi Minh City from the fourth quarter of 2021 until now, is only about 200 units, down 85% over the same period. However, the market's attraction is great, especially when the epidemic is under control, the market recorded an increase in business demand, so townhouses in podiums in high-rise apartment buildings recorded a rental rate. As well as buying and selling, all reach from 80-100%, the average selling price is from 150 million VND/m2.
The taste of "hunting" for commercial townhouses is more demanding
According to CBRE Vietnam expert, in the past 2 years, the supply of new projects in Ho Chi Minh City is limited, leading to the number of new shophouse apartments introduced to the market. The influence from the licensing of new projects along with the limited land fund, the supply of shophouses from the end of 2022 to the beginning of 2023 is expected to remain low.
In terms of supply, from the beginning of the year until now, Ho Chi Minh City has sporadically had a few dozen shophouses in the apartment podium for sale. In addition to 50 shophouses from two projects Westgate and D-Aqua deployed in the West, from next June, the market is expected to be more active when the number of products deployed grows, mostly concentrated in the area. City. Thu Duc like Shophouse The Global City, Vinhomes Grand Park, MT Eastmark City, Opal Riverside, Urban Green, Fiato Premier... However, the supply is expected to be around 200-300 units and will be traded quite small, divided into many distributions until the end of the year.
The supply of commercial townhouses in HCMC is expected to continue to be scarce in the coming years due to the limited number of newly licensed projects.
Although the supply is scarce and there is little competition, not every shophouse product that hits the market will be well received. According to Ms. Pham Ngoc Thien Thanh, senior manager of CBRE Vietnam, the upward trend of shophouse prices completely depends on the commercial exploitation of this type. Strictly speaking, a potential shophouse must provide value to both owners and tenants. Shophouses developed in large-scale urban areas, with the advantage of convenient transport infrastructure connection, dense population density and easy connection to neighboring commercial areas, will easily become golden egg-laying hens. , bringing profits to both owners and business tenants. On the contrary, lacking the above criteria, the commercial exploitation of the shophouse will be affected.
Considering the changing trend from buying demand, current supply in Ho Chi Minh City. Thu Duc really attracted the attention of investors and created a wave of transactions with only shophouse products in large urban areas such as Vinhomes Grand Park and The Global City. In terms of price and location, The Global City is slightly better in terms of purchasing power when the selling prices of shophouses here are more "competitive" and the potential for commercial location is evaluated on par with other projects.
“There is no denying the advantage of the shophouse model for business activities, but usually shophouses always have a price higher than normal apartments by at least 20%. Therefore, investing in this type of investment, investors must calculate carefully and need to have a good business plan and strategy. When buying a shophouse for investment, priority should be given to choosing products from reputable investors who have a good development strategy and project management, creating a community of residents - a potential customer group of investors in the future. when the project comes into operation", CBRE expert noted.
The Real Estate market welcomes a new supply source with projects by Masterise Homes starting from mid-2023
Expanding the An Phu - Belt Road 2 Expressway section, adjacent to The Global City in Ho Chi Minh City