Prices of apartments in Vietnam are falling after a long period of escalating values as more and more buyers look to buy houses, it is claimed.
This is forcing sellers to slash sale prices which some analysts are predicting could fall by up to 20%. In some locations prices have fallen by up to 30% since the end of last year, according to some agents.
Pham Van Hung from Hadico real estate supermarket said that most buyers are looking for street front houses in areas with good infrastructure. And an increase in demand is pushing up house prices.
Houses on Doi Can Street are now trading at 160 million dong per square metre, while the ones on Phan Boi Chau, Nguyen Truong To and Pho Duc Chinh at 230-250 million dong per square metre represent an increase of between 7-10 million dong per square meter, he revealed.
The houses on smaller streets like Nui Truc, Van Bao, Van Phuc, Linh Lang and Cau Giay area have lower prices, hovering around 100 to 110 million dong per square meter. While buyers are ready to pay 350 to 400 million dong per square metre ($19,440) for houses in ancient quarter such as Hang Ngang and Hang Dao streets. However, it is very difficult to persuade people to sell these sought after properties.
There is also a lot of demand from businesses, especially those operating in the finance and banking sector for street front houses. They are buying up adjacent houses and converting them into offices.
However apartments in the luxury price range are unaffected by this trend. For example, all six $3 million apartments in the Diamond Island project on the banks of the Saigon River have been sold with six buyers competing for each one, according to Nguyen Kim Son, director of sales and development at BTA Development Investment.
He said that around 70% of those buying the high priced apartments were Vietnamese or overseas Vietnamese, and the rest were foreigners. ‘Many people are rich these days. They are famous people who have a certain social position,’ Son said.
The Novaland Real Estate Investment company claimed that a 400 square meter apartment at its Sunrise City project has been sold to popular pop singer Cam Ly at more than $1 million and a penthouse for around $5 million to singer Dam Vinh Hung.
However, the director of a real estate company, who wished to remain unnamed, said people should choose carefully between buying such super-apartments, mostly in the outskirts, and a villa in the city’s downtown area because both would have the same price but traffic and certain services in the former area might not be as convenient.
He said that the $2 to $3 million that a super apartment costs can buy around 20 high end apartments or 45 average ones from other projects in HCMC.