According to real estate research and consultancy Jones Lang LaSalle (JLL) Vietnam, banks have increased interest rates and are more cautious in the process of loan application processing, which is difficult for customers to buy houses and the investment to cool down in the second quarter of 2019.
According to JLL, the demand for apartments for investment in Hanoi has cooled in the second quarter of 2019.
A JLL real estate market report for the second quarter of 2019 showed that the number of sold apartments reached over 4,660 units, 65.3% lower than the previous quarter. According to JLL, demand for investment has cooled down in the second quarter after a period of strong growth. Increasing interest rates and being more prudent in the process of loan application processing by banks make it more difficult for home borrowers.
However, the demand for accommodation in the affordable and mid-end segments remains good. Smart apartments have been quite attractive in the market recently, the sales rate of this type of product tends to be higher than ordinary apartments in the same project.
Along with that, after a period of strong growth, the supply from newly launched projects tends to slow down. The number of new launches in the second quarter reached 5,900 units, this figure was nearly half of the previous quarter's supply and mainly came from the next phases of existing projects.
With the number of newly launched apartments which was less than 6,000 units in the last quarter, JLL assessed, this was the lowest recorded level since the market recovered in 2014. Most of newly launched projects had Small size with a total of less than 500 apartments.
Primary selling prices were stable, with no major fluctuations. The selling price per project remained stable or increased slightly after a period of strong growth. Average market price excluding new projects in Q2 increased by 0.5% QoQ and 6.9% YoY.
In order to attract buyers, in the context of increasingly tight supportive lending policies, investors still maintain a stable price, many preferential sales policies have been applied to accelerate inventory. The applied policies include extending the installment period, discounting cash by 3-6% for customers who do not use the loan package.
JLL forecasted, in the remaining 6 months of 2019, new supply was expected to reach 10,000-15,000 units. New supply continues to target affordable and mid-end products to address demand for accommodation.
Along with that, the tightening of high-end real estate credit along with the limited land bank in the CBD leads to the lack of supply of luxury segment in the next few years. The volume of transactions in the market in the coming time may be affected by buyers who tend to be more cautious and selective in the absence of loan support packages and a slowing economy.
According to Minh Thu