Overnight auctions, sky-high winning bids, low starting prices... are the current situations occurring in many land auctions in Hanoi recently.
Most recently, after 14 rounds, the auction of 27 plots of land in Ha Dong district ended at 11pm on October 19. The highest winning lot was in Dong Danh - Dong Coc area (Phu Luong ward), the winning price was over 262 million VND/m2 with an area of 57.5m2, a total of 15 billion VND, nearly 8.2 times higher than the starting price. The lowest winning lot had a price of nearly 132.8 million VND/m2. The winning prices of other plots ranged from 146.4 million VND to nearly 183 million VND/m2.
This level is much higher than the land price level in inner-city districts of Hanoi such as Ba Dinh, Hai Ba Trung...
Mr. Nguyen Van Chien (Ung Hoa, Hanoi) said that currently, the starting price is still low, so it attracts a large number of participants. Accordingly, the starting price and deposit should be increased, which will limit land speculation.
Ms. Pham Thi Mien - Deputy Head of Market Research and Investment Promotion and Consulting Department of Vietnam Real Estate Brokers Association - commented that in the third quarter of 2024, the land auction story is "hotter" than ever with auctions held "overnight", recording hundreds, even thousands of people accepting to "eat and wait" to compete for a spot. The winning price is also a record high, equal to project land with well-invested infrastructure.
Ms. Pham Thi Mien said that when the new law tightens the subdivision and sale of land, land products are gradually becoming scarce. Therefore, it is predicted that in the coming time, auctioned land will continue to receive the attention of the people due to legal guarantees and low starting prices.
Speaking to Lao Dong, Associate Professor Dr. Dinh Trong Thinh - former Head of the International Finance Department, Academy of Finance - commented that there were signs of speculation in the auction in Ha Dong. Accordingly, some groups of investors and speculators wanted to inflate land prices to create a new price level, not only in Hanoi but also across the country. Auctions with sky-high prices and then abandoning deposits, disrupting market information like in Thanh Oai, Hoai Duc... are no longer too strange.
The consequence is that land prices in that area will increase significantly compared to the actual price, possibly even exceeding the price of land in inner-city districts. This makes it difficult for people to access housing. At the same time, businesses and the State also face many difficulties in compensating for land because prices are pushed up compared to previous prices.
Associate Professor Dr. Dinh Trong Thinh proposed a number of solutions to limit speculation such as determining starting prices based on market prices, limiting project transfers within 5 years and requiring investors to build houses within 2-3 years.
Previously, as Lao Dong reported, although the auction of 27 plots of land in Ha Dong had not ended, many "brokers" were waiting outside to sell the plots at a difference of 400 - 600 million VND. A woman named H said that she had won the auction of 7 plots of land, and through agreement with the group, the highest difference in price for each plot was 600 million VND/plot. However, if the buyer showed goodwill, she was willing to lower the price by 100-200 million VND.
