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Very cheap apartments booming
While the luxury apartment market is freezing with very few transactions, very cheap apartments priced from VND250-600mil are selling like hot cakes.
High demand
The high demand for low cost apartments has prompted real estate firms to shift to trading this kind of apartment. Udico’s apartments, for example, are now selling at VND4.2mil/sq m, while 58 sq m apartments at VND247mil. The apartments are located on Highway 1K in Bien Hoa city in Dong Nai province. Thuan Kieu apartments in Di An district in Binh Duong province are now selling at VND280mil/59 sq m apartment, while Sunshine VND320mil/apartment, and Tay Thanh in Tan Binh district, HCM City at VND400mil/apartment.
Slightly more expensive apartments also selling well are located in An Suong, Binh Trung, Vinh Loc, An Suong, Thanh My Loi, Bong Sao, Da Sa and Son Ky residential quarters.
The common characteristic of the apartments is that they fit normal people who buy the apartments for their accommodations. Cheaper apartments are located farther from the centre of HCM City. A lot of the apartments offered for sale have been in operation for five years. However, there are a lot of good-quality apartments on sale, including ones of Udico, Sunshine and Thuan Kieu projects, which are 15 km far from district 1, HCM City.
Tran Minh Phat, Deputy General Director of Thinh Phat Real Estate Brokerage Company in district 4, HCM City, said that most clients who buy these apartments have actual demand for accommodation. They are either new immigrants or newly-married couples. Phat said that his company served 1-2 transactions of luxury apartments a week in the last month, while it arranged 4-5 transactions of low cost apartments.
Danh Khoi Real Estate Company in Binh Thanh district in HCM City, one of the brokerage companies for low cost apartments, said that the demand for low cost apartments is very high, higher by far than the demand for luxury apartments.
Pham Minh Thoi of Thanh Long Company Ltd in Thu Duc district in HCM City, who has bought a Thuan Kieu apartment (VND300mil for a 40 sq m apartment), said that he was happy with the deal. The apartment is affordable for him, an officer, though it is far from the centre, while owning a luxury apartment worth several billion VND proved to be a far-away dream.
Low cost apartments prove to be also the choice of immigrants from the north, central region and Cuu Long River Delta provinces. Vu Thu Huyen from Hung Yen province, has also decided to buy a Tay Thanh apartment in Tan Binh Industrial Zone. She related that she sold a house in her home village at VND700mil and bought this one at VND550mil.
Though the apartments are low cost, they have acceptable material facilities, good living environments. The apartments are located near markets, schools and hospitals, which provide food and services at acceptable price levels.
A lot of sellers accept purchases by installments with preferential interest rates. Buyers can live in the apartments after they pay 30% of the value of the apartments.
Investors jump in
Realising the increasingly high demand for low cost apartments, a lot of real estate firms have jumped onto the bandwagon. Nam Long Company, for example, appeared on the market very early with its project E Home in district 9, HCM City, which is selling 50-60 sq m apartments at over VND500mil, while Linh Phong-Conic is selling apartments at VND7-8mil/sq m.
Dat Lanh Real Estate Company is seeking to build 30-40 sq m apartments (with the expected price of VND200-300mil each). Groups from Republic of Korea and China, and VinaCapital are moving ahead with projects to sell apartments for less than VND400mil/apartment.
Nguyen Van Duc, Deputy General Director of Dat Lanh Company, said that the prices of VND200-300mil prove to be affordable for many families.
Chairman of the HCM City Real Estate Association Le Hoang Chau said that businesses had been focusing on luxury apartments, while ignoring the low cost apartment market, which proves to have great potentials.
VNN
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