Credit institutions struggle to sell high-priced collateral
Credit institutions have been struggling to find buyers for their high priced collateral properties because market demand is low.
An employee counts Vietnamese banknotes at a bank in Hanoi. Photo by VnExpress/Giang Huy.
The state-owned BIDV has been trying to sell the Crystal Palace wedding center in District 7, Ho Chi Minh City since 2019.
The 2,675-square-meter complex, including land and an eight-storied building, is being sold at VND130 million ($5,619) per square meter, 35 percent lower than average land prices in the area, but there is no buyer.
The bank has also lowered prices by up to 33 percent on several land lots in District 1 and Binh Chanh District in Ho Chi Minh City, but buyers are hard to find.
The Vietnam Asset Management Company has also been unable to sell a building in HCMC's District 1 for VND6.11 trillion. The project has an area of over 6,700 square meters with four floors.
Huynh Phuoc Nghia, a senior consultant with consulting firm HIBC, said buyers are concerned about profitability if the costs of renovating a property is high, Nghia said.
Buyers also prefer to buy a property on which there is no construction, or "clean land," he told local media.
Other experts say that the collaterals are often sold in bulk, for example a piece of land in District 1 with some pieces in the suburb, which are unattractive to buyers.