22:17 (GMT +7) - Wednesday 26/10/2016


Residential price index up in HCMC but down in Hanoi

Released at: 11:07, 19/05/2016

Residential price index up in HCMC but down in Hanoi

While increasing 1 point quarter-on-quarter in HCMC the index fell 1 point in Hanoi, Savills write in their latest report.

by Quynh Nguyen

The latest report from Savills on the Property Price Index shows that while increasing in Ho Chi Minh City the residential price index decreased in Hanoi during the first quarter of the year.

The residential index for Ho Chi Minh City rose 1 point quarter-on-quarter and 2 points year-on-year, to 91.3. There were approximately 6,400 sales, a fall of 18 per cent quarter-on-quarter but an increase of 49 per cent year-on-year. The overall absorption rate was 17 per cent, down 4 percentage points (ppts) both quarter-on-quarter and year-on-year due to abundant new supply.

Grade C transactions increased 7 per cent quarter-on-quarter. Although Grade A and B sales fell 34 per cent and 32 per cent quarter-on-quarter, respectively, there was an increase of 83 per cent year-on-year in Grade A transactions and 68 per cent in Grade B.

Many factors contributed to the high sales and price movement in the first quarter, including seasonal factors, better construction progress, diversified product types, and flexible and extended payments offered by developers, many of whom adopted aggressive marketing campaigns.

In Hanoi, meanwhile, the residential index was 107.5, a fall of less than 1 point quarter-on-quarter but an increase of 0.2 points year-on-year.

The overall absorption rate was 34 per cent, falling 6 ppts quarter-on-quarter and 9 ppts year-on-year due to the usual effects of the Tet holiday. After high primary sales in the second half of 2015, sales in the quarter declined sharply to 5,600, or 13 per cent less quarter-on-quarter but unchanged year-on-year. Grade B saw the best performance, representing 66 per cent of sales with absorption of 37 per cent, a decline of 4 ppts quarter-on-quarter.

Grade A and C sales fell dramatically, by 61 per cent and 17 per cent, respectively, quarter-on-quarter. The draft revision of Circular No. 36, if applied, could significantly impact on access to real estate credit. In general, though, Hanoi’s residential market will continue to stabilize in 2016.

  • TAGS
  • residential index
  • Savills
  • Hanoi
  • Ho Chi Minh City

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