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Property market tipped to recover
The country's real estate market is expected to recover in the next two years due to the downward trend of housing prices, a stable foreign exchange and lower interest rate, economist Dinh The Hien has said.
Hien was speaking at a conference exploring property market opportunities, held in HCM City on Wednesday. He added that the Government was considering providing a support package which would improve the market situation.
He also stated that in the period from 2008 to 2012, the demand for market supply was high but property prices were also high, making it difficult for suppliers to offload their products.
Additionally, in that period the Government enforced stricter monetary policies, putting more pressure on the market.
Hien estimated that by the end of this year the turnover of real estate firms listed in stock exchanges would reduce by 20-25 per cent. Last year it dropped by 35-40 per cent over the same period of the previous year.
At the end of August, unsold and finished houses were worth VND41 trillion (US$1.9 billion). This amount is three times higher if unfinished buildings are taken into account.
Investment specialist Tran Le Khanh offered three scenarios for the market in the future. If the economy recovers slowly, housing prices will be reduced 10-15 per cent and unsold properties will be sold in the next three years.
If the economy remains unchanged, prices will reduce slightly, and if the economy recovers quickly then prices will sharply increase.
However, chairman of CT Group, Tran Kim Chung, warned that a cautious and considered view should be taken.
Chung said it was difficult to forecast the sector's situation because there are several macroeconomic factors affecting the market.
The general director of Hoang Anh Gia Lai Land, Le Hung, told Vnexpress that there was no momentum ready to lead the market to recovery next year. He said that property businesses have striven to increase liquidity due to the quiet market.
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