City condo market begins to recover

HCM CITY – Condominiums remain the best bet for people living in big cities thanks to their affordable prices, and not surprisingly the HCM City apartment market is showing signs of recovering after the slowdown caused by the Carina Plaza fire at the beginning of this year, insiders said.

A sales executive from TTC Land told Việt Nam News that when her company sold its new project in District 4, Charmington Iris, last week more than 150 out of 200 units were snapped up.

All three-bedroom units were sold, she said.

Nam Long Real Estate company told Việt Nam News the sale of its new Flora Novia project in Thủ Đức District last week attracted 1,000 prospective buyers.

All 273 units in block A were sold, it said.

With prices ranging from VNĐ1.5 billion (US$65,700) to VNĐ2 billion ($87,700), the project is in the most popular segment.

The second selling phase will be in September.

Not only the primary market but also the secondary market is witnessing a recovery, which is clearly shown through rising prices.

The prices of some new apartments have increased since the developer sold them.

Report from Sài Gòn Giải Phóng newspaper (The Liberated Sài Gòn) said that at Sunwah Pearl in Bình Thạnh District prices are up 15 per cent from the VNĐ45 million ($2,000) per square metre at which the developer had sold.

At The Sun Avenue in District 2, units are being sold at over VNĐ40 million per square metre. The developer had sold a year ago at VNĐ33-35 million.

Him Lam Phú An in District 9 with 1,000 apartments to be handed over by the end of this year is fetching original buyers a 15 per cent profit now.

Florita in District 7 has seen prices increase by 30 per cent.

The Ministry of Construction reported that condo prices rose by 1.4 per cent quarter-on-quarter in the second quarter of this year.

Industry insiders attributed the price increase to a supply shortage even as demand remains high.

Most transactions are at projects by prestigious developers which are making good construction progress.

Studies by market researchers clearly show the shortage of supply.

CBRE Vietnam said in the second quarter, 6,200 condos were sold, down 36 per cent from the previous quarter.

The HCM City Real Estate Association reported that supply fell by 44.5 per cent in the first half.

Lê Hoàng Châu, its chairman, said from now through the end of this year, many new projects would come into the market.

After some difficulties, the condo market would see positive signs in the next few months, he said, pointing out that since the beginning of this quarter new projects are witnessing sales of 60-80 per cent.

Condos priced at under VNĐ2 billion ($87,700) would make up the key segment, he said.

Property investment and management company Jones Lang LaSalle said in a report: “While the official new launches in the second quarter of 2018 totalled 6,947 units, down over 49 per cent quarter-on-quarter and 11.5 per cent year-on-year, the market also recorded a notable number of 6,000 units under soft launches.”

There were sales of 7,374 units in this period, down 19.4 per cent, in line with narrowing new supply, it said.

Of them, 70 per cent were in the affordable segment at prices of $1,000-1,200 per square metre, mainly in Districts 8 and Bình Chánh.

JLL said prices were higher quarter-on-quarter across all segments, with the affordable segment registering the highest growth of 2.6 per cent.

The secondary market too saw an uptrend in the second quarter with a 1.7 per cent rise in prices quarter-on-quarter against an average quarterly growth rate of 0.5 per cent over the 2017-18 period, it added. VNS