Ho Chi Minh City Construction Department’s survey found that about 20,000 apartments in the city’s realty market are unsold, out of over 45,000 apartment units that have been recently constructed and put into use.
Common apartments represent around 40 per cent of the total, with the remainder in the medium and high-end segments. Meanwhile, successful transactions in the past months mainly involved apartments priced between VND11-15 million ($520-$710) per square metre.
According to chairman of Vietnam Housing Joint Stock Company and chairman of Ho Chi Minh City property transaction centre network Tran Van Thanh, more than 1,000 successful transactions were recorded in the last three months and most of these transactions were relevant to apartments less than VND1.5 billion ($71,500) each in value.
“This means the realty market was not totally ‘frozen’. Medium and low-end housings are traded fairly well,” said Thanh.
Nguyen Van Duc, deputy director of Dat Lanh Real Estate Company, said property firms’ difficulties originated from their poor capital sources and market liquidity.
At this time, it is almost impossible for realty firms to rely on low-cost lending from banks. To address current woes firms need to capitalise on their strength and flexibility only, he said.
“The best remedy now is to change design and revise apartment areas to fine-tune market demands so as to boost its liquidity,” Duc opined.
In a recent Ho Chi Minh City meeting seeking ways to help property firms weather the difficulties, industry experts and managers suggested that the most urgent and practical solution now would be allowing firms to revise project designs with smaller apartment areas.
Under current regulations, at apartment projects each small unit measuring 50-70sq.m must be accompanied by two medium 80-90sq.m. and one bigger unit of more than over 100sq.m..
If firms got the right to build smaller apartments for sale, insiders said, it would help increase liquidity markedly.
In recent months, Ho Chi Minh City Planning and Architecture Department has received several requests seeking design revisions to enhance sales.
“Let enterprises decide on their project fate to match actual conditions. The state should only focus on control projects’ social and technical infrastructure,” said the department’s deputy director Nguyen Thanh Toan. Allowing firms to revise project designs, he said, would be important to save businesses.
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