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At a seminar in Ho Chi Minh City on July 30, Chairman of the HCM City Real Estate Association Le Hoang Chau said it is not a rosy picture in the property market. Since March 7, 2017, when the Prime Minister requested the projects using State-owned land to be reviewed, the market has faced considerable challenges and difficulties.
In 2017, the real estate market grew 4.07 percent from the previous year but began to decline in 2018.
In the first seven months of 2019, the whole market shrank 34 percent in size, including a 29-percent fall in the project number and a 34-percent decrease in the apartment supply. The supply dropped 44 percent in the high-end segment and 34 percent in the pocket-sized segment. Meanwhile, there weren’t any low-end property projects opened for sale in the second quarter.
Between January and July, the Construction Department of HCM City submitted only three new projects to the municipal People’s Committee for consideration, down over 80 percent. State budget revenue from real estate also nosedived more than 60 percent, Chau noted.
He said every cloud has its own silver lining, elaborating that more positive signs will appear in the city’s property market from now to the end of this year, including the implementation of projects in the eastern and southern areas.
Lai Duc Duong, head of the real estate analysis division at the Rong Viet Securities Corporation, said property companies posted relatively good profits last year. In 2019, most of them have recorded lower profit growth while those with faster growth are small-cap firms.
Regarding real estate stocks, short-term investment chances currently focus on businesses with good performance so far this year. In the long term, investors should pay attention to companies with big land reserves, he said, adding that there are five to six firms with very big land reserves for business purposes in the time ahead.
Meanwhile, Director of the KIS Vietnam Securities Corporation Truong Hien Phuong suggested investors pay attention to the companies with flexible switch to developing segments and stable growth. They should also choose appropriate points of time to buy property stocks since the time of purchase is can ensure 50 percent of investors’ success.
