Southern market still caught in the rough
Southern market still caught in the rough
There is no light at the end of the tunnel for Ho Chi Minh City’s residential housing market.
Hoang Anh Saigon Real Estate firm chief Doan Chi Thanh said the market was still in the doldrums despite a brighter macroeconomy in April with cooling inflation and more credit for property purchase.
Thanh said another factor was a rumour that property giant Hoang Anh Gia Lai (HAGL) Group would soon roll out an apartment project which would undercut nearby competitors by more than 50 per cent.
Hoang Anh Saigon reportedly eyed more than 100 successful transactions involving its apartment projects in 2012’s first quarter. Pham Ngoc Lam, chairman of Duc Khai Joint Stock Company - developer of The Era Town in Ho Chi Minh City’s District 7, said the HAGL rumour had rattled the market.
“A month ago, Duc Khai realty trading floor witnessed five to seven successful transactions a day, which sunk to just three transactions at this time,” said Pham Ngoc Lam.
ACB Real Estate Company director Pham Van Hai assumed housing prices would further slide.
“Investors chasing profits should be cautious since the market is still in trouble. For real homebuyers, it is time to buy since the prices of many properties fell to their actual investment costs and some below investment costs as developers face capital distress,” said Hai.
In respect to HAGL’s possible property plan, HAGL Group’s Hoang Anh Housing Development Company director Le Hung said the group would sell two property projects - one in District 7 and one in Tan Phu district, at discount rates.
The information has worried developers of several high-end apartments also in District 7 like Sunrise City developed by Novaland and Kenton Residences by Tai Nguyen Company Limited since these projects have been selling for VND30-40 million ($1,440-$1,920) per square metre.
“The scope and quality of projects may vary if they are in the same area. Usually, after deducting relevant expenses, 5 to 10 per cent profits are reasonable in an investment project. Buying or not depends on the part of buyers,” said Lam.
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