Assoc. Prof. Dr. Tran Dinh Thien, Member of the Prime Minister's Economic Advisory Group, said that although market conditions may cause capital to flow to real estate, this process will not take place in a one-way direction but will be accompanied by significant adjustments. When the demand for capital mobilization increases, the general level of interest rates will be under pressure to rise.
He believes that the Government's drastic development of social housing, with the commitment of more than 20 large corporations, can create a more abundant supply for the market. This contributes to stabilizing the price level, instead of creating hot waves of increases like previous cycles, thereby reducing pressure on real buyers and limiting the risk of bubbles.
From a long-term perspective, real estate is still a potential investment channel. After administrative unit mergers, the price level will have a clear differentiation. Some localities that were former administrative centers may witness price adjustments due to reduced roles. Conversely, areas selected as new administrative centers, accompanied by strong investment in transport infrastructure and public services, will have significant room to increase prices.
According to Assoc. Prof. Dr. Tran Dinh Thien, real estate prices in the coming period will largely depend on location, level of infrastructure investment and connectivity, instead of increasing simultaneously. The process of raising urban development standards is also a factor to strengthen the long-term prospects of the market, when future cities must meet higher requirements for environment, technology and quality of life, towards green urban models, smart cities and sustainable development. Therefore, investment activities need to be placed in a long-term vision, considering fundamental factors such as planning, infrastructure and urban development trends, instead of chasing short-term information.
Forecasting the price trend in the coming time, Dr. Nguyen Tri Hieu - Financial - Banking Expert said that in terms of long-term safety, real estate may be safer than some other investment channels. With the developing economy, real estate prices are difficult to decrease in the context of rising land prices, escalating construction costs and interest rates tending to increase slightly.
He believes that interest rates may increase this year and this is a factor that continues to create pressure to push up real estate prices. However, the current price level is already high, making short-term profit opportunities more difficult. However, in the long term, especially in the housing segment, the market still has room for growth because supply does not meet real demand.
