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HCM City real estate developers think small
Smaller apartments may be the next big thing in HCM City's real estate market, as developers realise this segment has been overlooked for quite a while.
Speaking at a seminar on adapting to changes in the residential market. Marc Townsend, managing director of the real estate service firm CB Richard Ellis Vietnam, said there was real demand on units between 50-80sq.m.
"Up to 80 per cent of Vietnamese who want to buy dwellings have not yet obtained their desires," said Townsend.
They instead rented for years to save up for their dream homes.
CB Richard Ellis deputy director Nguyen Nguyen Thai cited developers, in Hong Kong and Singapore still offering units around 75sq.m.
According to Thai, current buyers are interested in price, payment terms and construction progress to ensure completion as planned. Suitable prices are said to be between VND10-18 million a sq.m with a total value of VND600 million to VND1.5 billion.
Buyers are willing to buy homes outside downtown to avoid high prices, provided the commute is reasonable.
Previously, between 80-90 per cent of buyers were investors. Now, with investment requiring large sums of cash while yielding low profits, few are willing to sign on the dotted line for just an 8 per cent profit margin in District 5's Hung Vuong Plaza or 3.5 per cent in District 2's Villa Riviera.
"In the second half of the year, 12 projects with 8,000 apartments will be on the offer but only 30 per cent of the units have been sold already as buyers expect a price drop, not because there is no demand.
To date, prices have decreased for projects that will be completed in three years, but have changed insignificantly for projects close to finishing.
Between 2009 and 2012 more than 70,000 apartments will be for sale.
Eco living
Meanwhile, a new environmentally friendly trend is making its way into Vietnam's residental property market.
Recently the Vietnamese Becamex IDC Corp teamed up with Malaysian property developer S P Setia for the EcoLakes My Phuoc.
Covering 226 ha in the centre of the 3,700-ha My Phuoc Industrial Park in Binh Duong Province, the compound will feature an eco sanctuary out of respect for the preservation of ecological balance.
This project requires a total investment of US$800 million, and when completed in 2015 will include around 500 houses, 168 villas and over 1,000 apartments, among other developments. Residents will also enjoy various lakes and fountains, theme parks, large greenage and recreational spaces.
"We bring our experience in developing various residential areas in Malaysia to My Phuoc, especially the Setia Eco Park which won the Prix d' Excellence Award last year in Barcelona, Spain, granted by the International Real Estate Federation (FIABCI)," said SP Setia chief executive officer Teow Leong Seng. The award is to honour projects with outstanding design and construction.
VNS
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