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Real Estate

Land price expected to fall by 10 – 30% in 2020: ministry

Duyen Ha Tuesday | 12/03/2019 16:02

Photo: diaockimoanh.com.vn

Price of land plot is expected to drop by 10 - 30% due to the insufficiency of real demand, according to Ministry of Construction.

In recent years, land plot segment has always been considered an attractive investment since it brought investors high profits. Therefore, the investment in land plots has been favored by many real estate giants.

However, according to market researchers, this segment has been cooled off. In 2018, land market in Ho Chi Minh City has an increase of about 30-40% per year. In 2019, the average growth rate will be only 15%.

Land market in Ho Chi Minh City showed signs of slowing down. The only potential place of the market is in neighboring provinces of Ho Chi Minh City, which strongly welcome cash flow from corporate and individual investors.

In 2019, the price in this area increase by 20-25%. At some projects, price increased up to 35% compared to the beginning of the year.

From early 2019, legal review caused short in supply of land in Ho Chi Minh City. Investors moved to neighboring provinces for new projects.

Wrong-doings from Alibaba Real Estate have driven investors away land plot market.

Making forecast for 2020 real estate market, Economist Dinh The Hien said, in 2020, real estate market will decline and the land plot segment has the strongest decline.

In recent years, coastal land plots in Dong Nai, Long An, Binh Duong ... continuously increased. In these areas, there are no investor with real demand. If the demand for accommodation and rental is not real, the market will be in crisis, Hien added.

In addition, the decline of the real estate market and central bank’s tightening of credit policy are main reasons for the future decline.

Ha Quang Hung, Deputy Director of Housing and Real Estate Market Management Department under Ministry of Construction, said real estate market in the Southeastern region will be closely monitored after the case of Alibaba Company.

According to head of Vietnam Real Estate Association Nguyen Tran Nam, the difficulty situation of real estate market in 2019 could continue in 2020, because of unsolved legal problems.

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