According to The Global City, will the residential real estate market in Ho Chi Minh City recover strongly in 2022?
The Global City – Experts of VNDIRECT believe that residential real estate in HCMC will recover strong recovery in 2022 thanks to economic growth and low home loan interest rates.
According to VNDIRECT, a large-scale market recovery will help boost the real estate industry in 2022, when the global economy will maintain a strong growth momentum. Vietnam is an open economy, so there is plenty of room to take advantage of opportunities when global purchasing power recovers.
Vietnam will achieve high vaccination rates in the first half of 2022. From that, VNDIRECT experts forecast that Vietnam's GDP will grow by 7.5% in 2022, with high growth rates in all industries. .
In addition, VNDIRECT believes that home loan interest rates continue to remain low, helping to stimulate home buying demand. Currently, home loan interest rates at domestic banks are relatively stable at 9.2-9.5% in the first 9 months of 2021, still the lowest level in the past 10 years.
“We expect the State Bank to maintain an accommodative monetary policy in 2022 as inflation remains under control. We maintain our view that home loan interest rates will remain low at least until the end of the second quarter of 2022, thereby supporting real estate demand," experts of VNDIRECT said.
Also according to VNDIRECT,
The promotion of infrastructure development will be the driving force for the real estate market to grow in the future. Some projects have a positive impact on the real estate market such as: Long Thanh International Airport phase 1 (starting in early 2021); 6/11 North-South expressway component projects are under construction and the remaining 5 projects are expected to start construction in 2022.
In addition, some upcoming planning approvals will also support infrastructure development and land prices. In particular, the proposal to establish the Northwest city including Cu Chi and Hoc Mon, along with the information about moving the districts of Hoc Mon, Cu Chi, Binh Chanh, Nha Be and Can Gio to the district has boosted housing prices in the districts. This area increased sharply in the first half of 2021.
According to experts of VNDIRECT, the supply of new apartments in Ho Chi Minh City will bottom out in 2021 and recover strongly by 60-70% in 2022-2023, supported by new regulations removing nodes. legal constraints such as Decree 148 and the revised Construction Law 2020.
Citing data from CBRE, experts of VNDIRECT said that the supply of new apartments in Ho Chi Minh City in 2022 will recover 69.5% over the same period to 22,000 units and increase 55.7% over the same period last year. 34,000 units in 2023, of which the mid-end segment will increase again, accounting for 30-50% of the total apartment supply.
“We believe that the suburban housing market in Ho Chi Minh City such as Binh Chanh, Can Gio, Nha Be and Thu Duc will attract investment in 2022, thanks to the infrastructure development in these areas. The neighboring provinces of Ho Chi Minh City will continue to be a bright spot in 2022, receiving positives from both supply and demand and selling price,” said VNDIRECT's expert.
Regarding the selling price, VNDIRECT said that,
Selling prices continued their upward trend thanks to strong housing demand. Primary housing prices are unlikely to fall in 2022, due to the high cost of project development, including compensation and financial costs, in the context of the project's lengthening over the years and the cost of construction materials. construction is increasing rapidly.
“We believe that the selling price of primary apartments in Ho Chi Minh City will continue to increase by 1-7% yoy in all segments, in which the mid-end segment will increase the most by 7% y/y. period due to high demand while limited supply. The luxury segment will continue to be vibrant in 2022 with the launch of projects located at "golden" locations in District 1, Ho Chi Minh City and Thu Duc City, after a branded apartment project has been established. set a new price of 16,500 – 18,000 USD/m2 in 2021”, affirmed VNDIRECT expert.
VNDIRECT experts also believe that land prices in the vicinity of Ho Chi Minh City will continue to increase impressively in 2022, thanks to the expansion of highways to the western and coastal areas with ongoing infrastructure projects. deployed such as Ben Luc - Long Thanh, Dau Giay - Phan Thiet highways, Long Thanh international airport phase 1.
In addition, the proposal to establish a Northwest city including Cu Chi and Hoc Mon, in parallel with the relocation of districts of Hoc Mon, Cu Chi, Binh Chanh, Nha Be and Can Gio will further boost land prices in the areas. This will increase rapidly in the near future.