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Billion dong apartments safe bet in rough times
Apartments priced under VND1 billion (US$48,100) are attracting many customers despite hard times in the property market, Nguoi Lao Dong ( The Labourer) newspaper has reported.
Le Hoang Chau, chairman of HCM City's Real Estate Association, said property companies have shifted their attention to this lower-priced segment because of good liquidity.
He said this was a good time to buy houses because of the cheapest prices.
Even though material input costs of the construction sector have increased, apartment prices have been declining as property developers are willing to take a loss or have lower profits in an unstable market.
Doan Chi Thanh, general director of Hoang Anh Sai Gon Property Co said the cost of construction materials had increased by 30 per cent compared to the end of 2010 but apartment prices had come to a standstill, and had even fallen sharply.
Thanh said many customers were waiting for prices to fall even further, but he cautioned against doing, saying that construction prices wee not expected to drop.
Morever, the economy has been reovering and the price of apartments and land are expected to go up again.
Many property transaction floors in HCM City said customers showed interest in apartments costing VND12-15 million ($577-721) per sq.metre.
For instance, the Quang Thai Tower apartment project in Tan Phu District is selling well at the Hoang Anh Sai Gon transaction floor, with the price of VND13.5 million ($649) per square metre.
Hoang Anh Sai Gon Property Company said it was selling about 20 apartments at Quang Thai every month.
Le Thanh Thai, director of Quang Thai Co, said buyers were attracted by the price of VND800 million ($38,460) each and the favourable location near Dam Sen entertainment park, Co.op Mart and Big C.
Construction on nine out of 18 storeys with 272 apartments has been completed. Half of the apartments have found buyers.
Thai said customers would save about VND100 million ($4,800) beginning mid-month as part of a promotion, which includes a set of interior items worth VND15 million ($721) and a 10 per cent discount if buyers pay 95 per cent of the contract value.
The company said it would also ensure construction progress and quality, despite the difficult situation of the property market.
Similarly, apartments in buildings such as E-Home, Thai An, Thu Thiem, Le Thanh and TDH projects have been selling well.
According to property transaction floors, customers are mainly young couples and civil servants with a medium income.
Property experts and market research companies said apartments priced below VND1 billion ($48,100) were dominating the market.
These apartments are mainly located in Binh Tan and Tan Phu districts, which have favourable transportation link-ups with HCM City's centre. Many migrants and medium-income families are concentrated in these areas.
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