The real estate market in Ho Chi Minh City continued to record an increase in apartment prices in July 2024 when the price of affordable apartments increased slightly by 1%, from an average of VND 27.9 million/m2 to VND 28.3 million/m2.
The selling price of mid-range apartments increased by 2%, from an average of VND42.7 million/m2 to VND43.7 million/m2.
The selling price of luxury apartments increased by 3%, from an average of VND 83.5 million/m2 to VND 85.6 million/m2.
Although the real estate market in Ho Chi Minh City in particular and the whole country in general is having positive and brighter changes compared to the previous 2 years. However, up to now, the market still faces many challenges. Currently, the inventory of real estate businesses in Ho Chi Minh City is still very large.
According to the real estate market report of the Ministry of Construction, by the end of the second quarter of 2024, the inventory of the whole country is about 17,105 real estates, including 2,999 apartments; 7,045 individual houses and 7,061 plots of land.
Statistics from the consolidated financial statements of the second quarter of 2024 of 10 listed real estate enterprises show that the total value of inventories as of the end of June 2024 was about VND 288,000 billion, an increase of VND 2,000 billion compared to the previous quarter and an increase of 4.3% compared to the end of 2023.
According to statistics, from the beginning of the year until now, the number of licensed projects can only be counted on the fingers, the products launched on the market in the past time do not represent the average income of the people.
It is worth mentioning that Southern real estate enterprises are dominating in terms of inventory with typical representatives such as Novaland, Nam Long, Phat Dat, Khang Dien, Dat Xanh, An Gia. Most of the inventories of enterprises are in old projects that have been implemented for a while but have not been sold out.
The large inventory reveals that the health index of real estate enterprises is still unstable. This shows that the purchasing power of the market is still weak, liquidity in the real estate market in Ho Chi Minh City is still poor. Cash flow in the market is still slow and weak, while businesses still have to face large operating costs.
According to Mr. Su Ngoc Khuong - Deputy Director of the Institute of Informatics and Applied Economics, the new point of the market is that recently the legal policies related to real estate have begun to take effect, however, for the legal policies to come into life still depends on circulars, decrees, absorption, and market reactions.
Therefore, there are only a few months left from now until the end of the year, so these policies cannot be like a "magic wand" to help the market bustle. It is different from the stock and financial markets.
Economist Dinh The Hien has the opinion that the real estate market will still face difficulties in 2024, with low liquidity, increasing inventories, and the revenue/inventory ratio of only about 2.3%.
However, the market has paradoxes such as prices increase without selling, limited supply still cannot be sold while the principle of the market is that if supply is low, it must be sold.
Therefore, the real estate market from now until the end of 2024 must continue to be monitored. Only concentrated residential areas and those with strong enough cash flow can create momentum for growth.
"Although the economy has many bright spots, real estate cash flow has not been able to be released because real estate businesses are still facing difficulties and have not been able to access bank capital.
Consumption is still limited because employment has not recovered strongly and the middle class has to settle real estate debt. I think it will be until 2026 that investors will feel secure enough to put money down,” said economist Dinh The Hien.
