AFFORDABLE APAARTMENT PRICE MAY INCREASE 30% IN THE NEXT 3 YEARS

AFFORDABLE APAARTMENT PRICE MAY INCREASE 30% IN THE NEXT 3 YEARS

29/08/2016 00:08|INDUSTRY NEWS

In the period of 2016-2018, the price of apartments is expected to increase on average 5-7% a year, particularly cheap apartments can accumulate an additional 10% per year, equivalent to an increase of 30% in the next 3 years, according to Jones Lang LaSalle (JLL) Vietnam.

The Potential Real Estate Report of this unit said that the price increase was quite reasonable and acceptable in Vietnam market. Even if the apartment price increases by 30% in the next 3 years, the ratio of house price to income will still be stable because the income level has increased by 10% per year in recent years.

Regarding supply, JLL said that in the next 3 years, the number of condominiums on the market may increase to 74%. The basket of luxury and luxury goods priced at over US $ 2,000 per square meter will double the current price.

Abundant supply is the result of impressive sales in 2015 (sold 24,000 units) and 16,800 units in the first half of 2016. In the 2011-2014 segment of luxury and luxury apartments only accounted for 10% of the market basket of goods in the market but now this rate has increased sharply, in 2015 jumped to 27% and the first half of 2016 has reached the threshold of 44. %.

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According to JLL forecasts, affordable apartments can increase prices by 10% per year for the next 3 years, equivalent to the total increase for this cycle of 30%. Photo: Hao Bui

However, according to World Bank data, urban households in Vietnam have an average income of about USD 460 per month and the top 20% of households have the highest income at about USD 1,340 per month. Only families in the top 20% are able to buy most of the apartment segments developed by different developers.

For households outside the above income line, the World Bank estimates that the Government has offered a support package of VND 30,000 billion since June 2013 to increase affordability for households with income. on average by reducing the mortgage interest rate to 5% compared to the normal interest rate of 7.5-10%.

According to VnExpress, if comparing the price of housing with the income of workers in Vietnam's big cities, the majority of people still cannot afford to buy a house. Customers have many difficulties in buying houses due to insufficient financial capacity or ineligible for loans.

One of the biggest concerns of buyers is that if they cannot afford a one-time payment, they must buy installment apartments, but the interest rates are only for short-term incentives from 6 to 18 months, then float. Meanwhile, the current VND 30,000 billion incentive package to support people with modest incomes buy the first house with 5% interest has expired disbursement of new loan applications. Therefore, buyers of mortgage installments will face more and more difficulties in the face of market interest rate pressure.

Previously, in 2014, based on the survey of salaries of more than 500 qualified workers in Vietnam's major cities, CBRE assessed that couples in Ho Chi Minh City and Hanoi had good jobs and stable incomes. Can start buying houses from the 7th year onwards. The savings rate for the first year of a married couple working (salary 900 USD a month or more) is 10% of income. This number increases steadily every year, taking into account income growth.

Real estate experts forecast that, for the market share of affordable apartments, low-cost commercial housing, there should be timely support policies or strong socialization, avoiding the phenomenon of supply of real estate. This product shrinks gradually over time and is rapidly increased due to scarcity.

DiaOcOnline.vn – Theo VnExpress

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