CBRE report notes positive signs but rules out significant growth in short term.
In Q4 2014 the villa and terraced house market in Hanoi saw two new launches: Ecopark - Park River and Sunny Garden City. In total there were five new projects in 2014 with about 750 units in total - much lower than in previous years and helping to ease pressure in a market where supply still outweighs demand.
According to the Q4 2014 report from CBRE, released on January 6, the quarter was the second in which there was an increase in the resale price, of 0.4 per cent quarter-on-quarter. On a year-on-year (y-o-y) basis it fell 7 per cent, compared to 30 per cent and 20 per cent in 2012 and 2013, respectively, suggesting that prices are stabilizing.
Despite some positive signs there will be no leap forward in the villa and terraced house segment during 2015. Mr. Richard Leech, Executive Director of CBRE, said that the average market price will move slightly upwards over the next few quarters on the back of revised laws and regulations and returning market confidence. Legal changes, allowing foreigners to own houses in Vietnam, are expected to boost sales in the residential market. “However, there will be no breakout because the new law takes effect from July,” he said.
Nonetheless, the villa and terraced house segment will still increase, with Cau Giay, Ha Dong and Gia Lam districts, where public infrastructure and population size have improved, bridges completed, and urban railway links on the way, witnessing price increases in 2014 of between 2 per cent and 9 per cent against 2013. To create strong and sustainable growth in the segment, developers should note that quick construction progress and convenient amenities are factors in attracting buyers.
Q-o-Q changes in secondary prices of villas (VND million per sq m, basic
Source: CBRE Vietnam