Sea frontage real estate prices escalated

Many coastal projects in Central Vietnam have recorded record price increases in the past 3-4 years, coinciding with land fevers spreading across the country.

The land hot status has left many price fluctuations for the central coastal land market. Particularly, in the past 2 years, this segment has attracted many real estate giants in Ho Chi Minh City because the biggest urban area in the South is facing obstacles as the project's legal footsteps. Increasing demand for resort real estate has led many coastal projects to be sold with unprecedented strong amplitude.

Five years ago, along Nguyen Tat Thanh street in the North of Cam Ranh peninsula (Khanh Hoa), a number of land projects were launched at relatively low prices, selling was not easy. However, in the next 3-4 years, the price of coastal plots in Cam Ranh has constantly accelerated due to the hot status of land, including projects from the first sale to now has increased 3-5 times, even the position increased by 10 times.

For example, a large-scale coastal project, located along Nguyen Tat Thanh route, when launching the product for the first time, the average price is only about 3.6 million VND per m2. Currently, the price has soared to an average of 18-25 million VND per m2. Particularly for the frontage of Nguyen Tat Thanh street, the transaction price jumped to VND 40 million per m2.

Perspective of a sea front project in the Central recently launched.

Before the second quarter, the coastal hot status of real estate also spread to Binh Thuan. A project of 1,000 hectares in Phan Thiet, invested by a real estate agent in Ho Chi Minh City, offers a 200-240 m2 sea villa of up to VND 5.5-6.5 billion per product. This project has set a new price ground for the Phan Thiet beach front land market, up 3-5 times higher than the 2015 milestone.

In Mui Ne, average plots of land near the sea bought and sold in the market soared by VND 20-30 million in the second quarter of 2019, though only VND 14 million per m2 before Tet. The plots on Huynh Thuc Khang street recorded the asking price of large batch of 13-14 million dong per m2, this level has increased by 2-3 times compared to the period of 2016.

Similarly, markets that have long been known as Vietnam's coastal tourism capital such as Nha Trang or Da Nang also increase coastal land prices 2-3 times compared to 4-5 years ago and are still anchored at current prices. Although the hot status has subsided.

In the past 6-8 months, the coastal land fund in Quy Nhon has also received many new investment waves. Some areas such as Quy Nhon, Nhon Hoi and Nhon Ly of Binh Dinh province are attracted by many investors in Ho Chi Minh City and Hanoi to hunt land funds to develop projects. From the second quarter of 2019 to the present, the number of land plots along the red book plots in Nhon Hoi and Quy Nhon is launched on the market not less than 3,000 plots.

According to Mr. Nguyen Hoang Son, Deputy General Director of Sales and Marketing of Danh Khoi Company (DKR), the reason that real estate on the coastal roads now escalates after the hot status of land and anchor at very high prices was thanks to the potential for high-value marine tourism. In addition, almost all those who own land with frontage sea have no need to resell.

Coastal real estate in recent years has grown strongly thanks to impressive tourism growth leverage and interconnected infrastructure increasingly better. Compared to 10 years ago, in coastal roads, particularly in the tourist cities of the Central region such as Nha Trang, Da Nang, Quy Nhon... land prices are still quite low. Vo Nguyen Giap Street of Danang, or Xuan Dieu Street of Quy Nhon, the land price is only around a few dozen million dong per m2, even lower.

But these roads are increasingly scarce and become assets worth millions of dollars, even billion dollars when discovered, embellished and exploited properly. There are even coastal areas located in bays that are up to dozens of times more expensive than inland.

"In the newly developing coastal areas, the land price is always attractive because of its favorable location for business exploitation, the supply and demand is much less so there is often a high price increase band, which is also an all-round trend", Mr. Son analyzed.

Meanwhile, according to Mr. Duong Minh Tien, General Director of Asia New Time Company, the growing development of infrastructure, from road systems to airways, helps the seas to increase the number of tourists. People's lives have been improved, the demand for travel experiences from individuals, family, and friends is increasing.

However, the current fact is that the uneven development among the coastal cities has led to many areas of the golden sea being overslept. After the surfing investment trend, the trend of accumulating valuable real estate (commercial) will be sustainable over time.

Mr. Tien added, another factor that made coastal land have a large price fluctuation in recent years is also due to the psychology of embracing land that has been ingrained in the minds of Vietnamese people.

According to Vu Le