Apartments become more affordable

Recently, real estate developers have held a lot of presentations where models of apartments shown, including Anh Tuan Apartment project (Nha Be District, HCM City) and Dai Thanh apartment bloc (Tan Phu District), My An project (Thu Duc district), Truong Tho Apartment and Duc Khai project in District 7, Happy Plaza, Long Phung Apartment, Lotus Garden, Babylon Resident 1. The sale prices prove to be very “reasonable”, between 14.9-15.2 million dong per square metre.

Real estate experts said that developing medium cost is a good choice for real estate developers. As the market has been quiet with a very low number of successful transactions, it would be better to develop projects with reasonable prices to target clients with real demand for accommodation.

Dang Hoang Huy, General Director of Vinaconex Xuan Mai, believes that the demand for low and medium cost apartments will remain high for many years still. Therefore, it is understandable why real estate developers now rush to develop medium cost projects.

Le Hoang Chau, Chair of the HCM City Real Estate Association, thinks that it is the medium cost apartments which are reviving the market. Medium cost apartments will still be the key products in the market in 2010 and 2011 as well.

He went on to say that the line products will be developing because both their main clients, i.e. those with real demand for accommodation and investors, can afford them.

But it’s still difficult to sell apartments

Though many reasonably priced products have been marketed, many people still decide not to open their purse strings at this moment.

Anh Tuan Apartment project in Nha Be District offers relatively low prices, but only 30 customers have deposited money, though 150 visitors attended the apartment presentation.

Happy Plaza project in Binh Chanh District also has low sale prices, at 12.5-13.5 million dong per square metre, but only 200 customers have booked the apartments.

Hugo Slade, Deputy Director of Cushman & Wakefield Vietnam, said that now all buyers want to keep waiting. “They wait to see in what areas the infrastructure projectswill develop, to see if the bank interest rates will decrease and what projects will have the best facilities,” he said.

Especially, he said, buyers are still waiting to see how low the sale prices will become.

The current lending interest rates are relatively high, at 16-17.5 percent per annum, which explains why many people do not want to borrow money from banks to purchase houses.

Meanwhile, real estate developers say that the current sale prices at 12-17 million dong are already very reasonable. They said the prices will go down further only when the prices of construction materials go down.

Source: Vietnam Net