Vietnamese not snapping up new homes in time for Tet

Traditionally this is a good time for the Vietnamese real estate industry as people snap up new homes to house visiting relatives and host parties – but not this year.

In fact, already the industry is concerned it will be stuck with properties that won’t sell either before or after Tet.

Tuan, a real estate investor in Binh Tan District in HCM City has three houses for sale, built in November 2009, but none of them have buyers.

“A lot of people came to see the houses, but none ever returned,” he said.

“The months just before Tet are the time for people to get married and purchase houses. In addition those who have been lucky with investments purchase houses at the year end. However, it seems that it is quite different this year,” Le Hoang Chau, Chairman of the HCM City Real Estate Association, said.

Tuan said his three houses are some 50-60 square meter each which he plans to sell at between 1 and 1.2 billion dong. However, people are still saying prices are overly high. Tuan has promised to pay the commission of between 3 and 5 percent to agents who can find buyers but so far none have succeeded.

Tuan said that he has spent some 2.7 billion dong in total on the project, and could yet sustain heavy losses.

Meanwhile, a marketing director of a high grade apartment project in District 7 in HCM City said his company now has 400 apartments for sale at a price of 40 million dong per square metre.

The company has launched nosy advertisement campaigns for the project and employed new brokers and marketing officers. However, the response has been poor.

Lan Huong, an officer of the Dia Loi Real Estate trading floor in District 2, said that during the same period in previous years, the number of successful transactions increased by 20-30 percent.

Pham Van Hai, general director of ACB Real Estate Trading Floor, also said sales has been going very slowly, especially apartments. Sales have actually decreased by 20 percent compared to previous months

“There are many visitors, but few buyers. Our officers have been sitting idle,” Hai said.

Real estate developers say there has been a lot of bad news for the real estate market. People now have had to pay personal income tax for real estate assignments. Real estate developers cannot borrow capital from banks, while the lending interest rates have become overly high. The gold price has also been increasing. All that factors have prompted a “wait-and-see” attitude rather than a rush to buy.

Hai believes the demand for houses is still big, and people are not buying because they cannot access bank loans.

Meanwhile, Nguyen Xuan Loc, deputy director of Vinaland, thinks that lower levels of money sent by overseas Vietnamese to relatives in Vietnam, has meant that people have less money to purchase homes.

VietNamNet/SGTT

Tags: vietnam real estate market