Land prices set far higher
Many localities have raised their land prices by up to 70%, while on the national scale the Government is expected to issue a new price framework, driving up prices by 30%.
An area divided into small residential land lots in HCMC. Land prices are expected to surge in the coming months
Land prices during the 2020-2024 period in Hanoi will increase by 15%-30%, while prices in Binh Duong Province will surge by 45%-95%. In addition, the land prices in some parts of Quang Ninh Province will be five times higher than the current levels, Thanh Nien Online newspaper reported.
In HCMC, the land prices are expected to soar by 41%.
Le Hoang Chau, chairman of the HCMC Real Estate Association, stated that the higher land prices will push up land use fees. The land use fees account for some 10% of the prices of apartments, 30% those of townhouses and half those of villas.
Therefore, the land price hike will hinder low- and medium-income laborers from buying homes.
Further, the prices of real estate products will be driven up, negatively affecting enterprises, other economic sectors and the attraction of foreign direct investment.
Some investors are striving to buy products to earn profits when the land prices are raised.
Specifically, property developer Thinh Hung Holdings has put up for sale 1,200 apartments under the Vietuc Varea project. After a month, some 600 apartments were sold at an average price of VND14 million per square meter.
Many customers noted that they had bought the apartments to earn profits. Some others are seeking to buy land lots for their own accommodations before the land price hike, remarked Huynh Minh Thang, general director of Thinh Hung Holdings.
According to Tran Hien Phuong, general director of Seaholdings, many projects in HCMC have been put on hold due to obstacles relating to administrative procedures, resulting in a decline in real estate supplies.
Moreover, land prices may surge further in the coming years. Therefore, enterprises have rushed to HCMC’s neighboring localities, such as Long An, Binh Duong, Dong Nai and Ba Ria-Vung Tau, and even Hau Giang, Soc Trang, Bac Lieu and Ca Mau, to develop real estate projects.
According to experts, HCMC’s neighboring localities have lower land prices, attracting more investors. SGT
Legal bottlenecks have affected the real estate market since the beginning of the year.
The policy on allowing foreigners to own houses associated with land in Vietnam has been studied and considered very carefully.