"The real estate market in 2019 will basically not have much fluctuation, especially if it is difficult to be hot like 2017. This year also does not have to worry about bubble or default because the state has more experience in managing and monitoring the market".
The above comments were made by Deputy Director of Housing Management and Real Estate Market Nguyen Manh Khoi and some experts at the forum on finance - real estate organized by Vietnam Real Estate Brokers Association and the Media Association Hanoi held on 4/5.
Will capital flow from securities to real estate?
At the forum, Vice Chairman of Vietnam Real Estate Association Nguyen Manh Ha said that the real estate market in early 2019 is showing signs of slowdown, most clearly expressed in Hanoi and Ho Chi Minh City as two places. Specifically, in Hanoi, real estate supply decreased by 25% compared to the same period last year. In HCMC, the supply of real estate products decreased by more than 50% compared to early 2018. The cause of the decrease in supply is the large projects in these two localities that have opened most of the products in quarter 4/2018. Besides, the slow approval of projects in Ho Chi Minh City, the tightening of real estate credit made from 2017 and especially in the fourth quarter of 2018... is also the cause of reducing the supply of real estate product.
"It is said that the real estate market in 2018 and 2019 will go down in a 10-year cycle. But I think it is not so, the real estate market in 2018 and early 2019 still shows the quite stable development" said Mr. Ha. According to Mr. Ha, in 2018, the supply and volume of successful transactions in the real estate market segments, especially the housing segment, had good growth. The total supply of residential real estate reached 175,000 products, an increase of about 20% compared to 2017; Total successful transactions reached 113,000 transactions, market absorption rate reached 90%. Many experts at the forum expressed that the recognition of the market is going down in 10-year cycle is not worrying because the state management agencies, businesses, investors... have gained much experience from The real estate crisis in the early 2010s. From these lessons, this experience will help a lot for the stable development of the real estate market.
According to Dr. Le Xuan Nghia, former Vice Chairman of the National Financial Supervisory Commission, will come here with a huge shift of capital flows from the stock market to the real estate market. This shift can start from 2019 and quickly, it can last until 2021, slowly, until 2023. That means, the period from 2021 - 2023 real estate market will be at the peak and possibly have risk of bubbles in both this year and the next year, it is difficult for real estate bubble.
Economic expert, PhD. Vo Tri Thanh said that in the past time, planning information is very vulnerable to rumors, so the market needs information to be transparent. This will limit the price speculation factor, avoid disadvantages for real buyers. The real estate market has been restructured with a clearer source of resources such as clearly identifying each type of product and there will not be such hot segment of real estate product segment.
"Do not tighten up harsh real estate credit"
Evaluation of market movements in the remaining period of 2019, the Vice President of Vietnam Real Estate Association acknowledged, the real estate market will continue to be influenced by the following factors: stable development domestic macroeconomics and the growth of the world economy, especially changes in credit policy for real estate. Specifically, the scale of real estate credit has gradually decreased since 2016, especially in the fourth quarter of 2018. It is predicted that real estate credit will be more strictly controlled, with the State Bank consulting on the draft to replace Circular 36, regulating safety limits and ratios in the operation of foreign credit institutions and bank branches.
Accordingly, it will reduce the maximum rate of short-term funds used for medium and long-term loans to 30% or increase the risk factor from 50% to 150% for personal loans demand for life has a principal balance of 3 billion VND or more. These changes will have a significant impact on the real estate market. However, according to Mr. Ha, there are still many positive factors that help the real estate market continue to grow stably: the demand for residential real estate is still high, especially in big cities and new administrative - economic zones.
"Strictly controlled real estate credit will make the quality of real estate loans more quality and healthier, reduce bad debts, and will stimulate other capital sources to invest in real estate such as private capital, remittances, foreign investment, real estate securities, and real estate prices may increase slightly due to lack of supply" Mr. Ha said.
According to TS. Le Xuan Nghia, the State should not strictly control credit on real estate but should control total credit in general. From now until 2021, there will be no signs of the real estate market collapsing. However, the predictions of the world financial experts, during the period 2021 - 2023 is an extremely sensitive period for both the financial market and the real estate market.
Besides, Mr. Nghia said that the upcoming orientation of the real estate market, in the short and medium term, may still be a house but the long-term prospect of tourism real estate and resorts is huge. On a global scale, it is expected to shift from the financial market to the commodity market, including real estate. Commenting on the market in the second half of 2019, Mr. Nguyen Manh Khoi said that the State Bank's short-term lending restrictions for medium and long-term loans, many real estate enterprises may face initial difficulties. But this is also an opportunity for enterprises to restructure goods and investment sources, thereby redefining investment strategies, avoiding bubble phenomena and investment trends.
Moreover, in the coming time, the credit control on real estate will be more and more concerned by the State. Because credit is reduced, speculation activities will be reduced. This will limit the speculation of price blowing, avoid the disadvantages for buyers with real needs. Along with that, when the State strictly controls the source of real estate credit, it is going to form a new investment trend - attracting a large amount of capital from M&A sources for resort and industrial real estate, office for rent... in some potential localities. Therefore, businesses need to have research in order to have a suitable cooperation and investment diversion.
According to Vneconomy