» » Housing supply forecast to increase significantly

Real estate developers all have predicted that housing supply will be really big in the time to come, and give people more opportunities to purchase products suitable to their financial capabilities.

Nguyen Van Minh, Secretary General of the Vietnam Real Estate Association, said that with the Government’s demand stimulus package, a lot of real estate projects have been implemented, which will lead to the higher supply of real estate products in the time to come.

According to the Ministry of Construction, 54 of 63 localities have submitted reports, registering the implementation of state-funded housing projects for students in 2009-2011. These include 267 projects to be implemented in 2009-2010 which will provide 5 million square metres of housing on the area of 554 hectares. The projects are expected to provide accommodations for 800,000 students. Twenty-one localities have sent reports and 19 provinces have registered to carry out 110 projects on building houses for workers in 2009-2015.

Moreover, 21 localities have registered to undertake 189 housing projects for low-income earners which will be implemented in 2009-2015. The projects will provide more than 150,000 apartments for 700,000 people.

Deputy Minister of Construction Nguyen Tran Nam said that the projects will help reduce the demand for accommodations, which will also lead to the decreases of real estate prices on the market.

In the first six months of the year, the housing area increased by 22 million square metres nationwide. In urban areas, the housing area increased by 11.4 million square metres, while the figure is 10.6 million square metres in rural areas. The total housing area nationwide has reached 1,000 million square metres (320.7 million square metres in urban areas and 737.6 million square metres in rural areas). The housing area per capita is 12.2 square metres.

There are now 486 new urban areas of 20 to over 1,000 hectares each which cover an area of 74,054 hectares.

In Hanoi, city authorities have permitted the continuation of 241 real estate projects, 60 percent of which are housing and new urban area projects.

Many new urban area projects are more than 100 hectares, mostly located in Ha Dong district, including the 174.23 hectare Duong Noi urban area invested in by Nam Cuong group, the 101.37 hectare Le Trong Tan area, 181 hectare Nam An Khanh and 206.40 hectare Bac Anh Khanh area.

Nathan Cumberlidge from Colliers International also said that with many projects under construction, the supply will be profuse in three years, while the profit from real estate (leasing fee) will not increase.

A question yet to be answered is if Vietnam will have a market with healthy and sustainable development in the time to come.

David Blackhall from VinaCapital investment fund said that this will depend on many factors, including transparency in the regulations, especially the ones related to ownership, project licencing and trading. Transparency helps develop a real estate market, while it also helps people purchase products suitable to them.

Source: VN Economy

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