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Hanoi real estate market witnessing virtual waves
In order to sell land and houses, speculators have created a lot of ‘artificial price fevers’ to urge people to rush to buy real estate for fear that the prices would increase further.
Real estate prices pushed up in accordance with ‘virtual demand’
Real estate prices in Hanoi have been staying firm, which has led to decreases in successful transactions on real estate trading floors.
Meanwhile, according to Pham Trung Ha, Director of Hoa Phat Real Estate Company, land and apartment prices at many projects in urban areas were increasing sharply.
Prices increased by 20-30 percent in just a few months, or even by 60 percent, because investors ‘surfed’ on their investments. After prices at projects reached overly high levels, and could not be pushed up further, investors ‘jumped’ to other projects.
Ha said that these ‘surfing investments’ has led to the fact that more and more ‘hot places’, where prices escalate rapidly, have appeared in Hanoi’s market. However, the areas cool down when prices reach high levels.
In Duong Noi and Van Khe urban areas, the real estate price was just 20 million dong per square metre after Tet, but has risen to 28-30 million dong per square metre now.
At Van Phu urban area, the land price has surged to 20-22 million dong per square metre.
After the land prices reach high levels in some areas, the price increases will stop and transactions will become fewer. After that, the ‘land price fever’ will be transferred to other areas.
For example, after the price fevers in Van Khe, Van Phu and Duong Noi areas finished, fevers were seen with Vuon Cam or Geleximco projects. The land prices at the projects increased by 20-40 percent in just a short period. Currently, the land price at the projects is hovering around 20-22 million dong per square metre.
However, the fevers at Vuon Cam and Geleximco projects have also finished because they are now attacking more distant areas: the Van Canh new urban area, Tan Tay Do and the northern area of Highway No 32.
The land at Van Canh and Tan Tay Do urban areas is now going for 16-17 million dong per square metre. At the northern area of Highway 32, the price has been pushed up to 20 million dong per square metre.
However, as ‘hot places’ like Van Canh and Tan Tay Do have seen prices reach overly high levels, investors have lost interest.
The apartments at 34T buldings, or 24T1 or 24T2 in Trung Hoa Nhan Chinh areas now also have high price levels from 29 to 35 million dong per square metre.
Therefore, the prices of the buildings invested in by Vinaconex in Trung Hoa Nhan Chinh area are not likely to increase further. That explains why the buildings are still on offer on trading floors, but buyers are hesitant to buy them.
There will be many ‘artificial waves’
The information that Hanoi authorities have asked the Prime Minister to allow the resumption of 240 real estate projects in the former Ha Tay province has been applauded by real estate investors in Hanoi. If the 240 projects get the go-ahead from the Prime Minister, Hanoi’s real estate market will see new ‘fever places’.
However, analysts say that investors will have to wait six months more to see new products launched onto the market. Therefore, Hanoi’s market will have to operate now with the available products.
The analysts say that as the prices in the areas are high already, in order to successfully sell products, speculators will have to use tricks to create new virtual fevers to make people worry about new price increases.
Phuoc Ha
vietnamnet
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