Real estate market developments in the first 9 months of 2022 and prospects in 2023

Real estate market developments in the first 9 months of 2022 and prospects in 2023

 

1. Real estate market picture in the first 9 months of 2022 

 

According to newly released data from the General Statistics Office, GDP in the third quarter of 2022 was quite high, increasing by 13.67% over the same period in 2021, and contributed to pushing growth in the first nine months of 2022 to eight. 83% – the highest level since 2011. In addition, the economy is still in good inflation control plan, FDI disbursement is good, the USD/VND exchange rate is still at 3% , maintaining the level. stability.

 

However, transactions in the real estate market for sale were quite quiet, with positive signals only in the rental real estate market. In the third quarter of 2022, interest in real estate for sale in Hanoi decreased by 3% compared to the first quarter of 2022. Demand for real estate in many provinces decreased compared to the second quarter , for example, Hai Phong was estimated to decrease by 19% , Da Nang decreased by 12% , and Can Tho decreased by 14% .

 

Figure 1. Real estate rental market increased strongly in the third quarter of 2022
 Figure 1. Real estate rental market increased strongly in the third quarter of 2022

 

However, the demand for real estate rental in Hanoi and Ho Chi Minh both increased by 58% and 13% respectively in the third quarter of 2022 compared to the second quarter. Specifically, the apartment rental sector in Hanoi increased by 13 % from the previous quarter.

 

The affordable housing segment has great demand, but the supply is short and weak, so prices increase sharply. Up to now, house prices have increased by about 30% compared to 2021 and increased by 50% compared to 2019. Especially with the apartment segment at about 25 million/m2 which is no longer found on the market, showed low absorption. Many projects promote from 15-35% products to increase buying demand.

 

The Grade B office segment showed strong attraction mainly thanks to transactions in a number of office buildings in prime districts such as Ba Dinh and Cau Giay in Hanoi, focusing on banking, finance, insurance. insurance, information technology, e-commerce. These are the sectors that have recovered the fastest from the Covid-19 pandemic.

 

2. Positive and negative impacts on the real estate industry in the fourth quarter of 2022 and in 2023

 

2.1. Positive impact

 

Real estate market in the last 3 months of 2022 will be more positive from the following positive impacts :

 

Firstly, GDP growth is positive in the third quarter of 2022 and is forecasted to be promising in the fourth quarter of 2022 and in 2023.

 

Second, the policy is removed for the real estate market.

 

Third, the impact of new regulations on infrastructure planning and credit lending.

 

Fourthly, loosening the credit room from 0.7-4.0% in order to recover the economy also has a strong impact on the development of the real estate market when capital flows are circulated.

 

 

2.1. Negative impact

 

Forecasting the negative impacts that the real estate market will face in the last months of 2022 and in 2023:

 

Firstly, the state continues to maintain the move to tighten the issuance of bonds and real estate credits.

 

Second, the source of materials (cement, construction costs (petrol prices,…) continue to escalate .

 

Third, the global economy including the 2022 real estate market is affected by some political turmoil in the world that may spread to 2023.

 

Fourth, inflation is high globally and unpredictable in Vietnam.

 

Fifth, the primary selling price continuously increased , beyond the ability of the majority of buyers with real needs.

 

3. Real estate market forecast for the last 3 months of 2022

 

The real estate market for land plots in the fourth quarter of 2022 may not have a land fever when state agencies are controlling the transparency of project information. Besides, the shrinking capital source also reduces the liquidity of the real estate market. Land prices in residential areas in the last 3 months of 2022 may decrease slightly but will continue to remain high in some localities. The supply of new housing is forecasted to continue to be limited when the order, procedures and conditions for real estate transactions become difficult.

 

 

Figure 2. Real estate market forecast for the last 3 months of 2022 
                     Figure 2. Real estate market forecast for the last 3 months of 2022 

 

The retail and office real estate market is showing positive signals . The new supply of Grade A and B offices for lease will be supplemented from a number of office building projects that will be completed and plan to launch in the last 3 months of 2022. For commercial premises, expected to be supplemented with supply from a number of completed and planned large supermarket and shopping center projects. The goal is to anticipate increased shopping demand by the end of 2022.

 

The industrial park real estate market in the fourth quarter of 2022 is forecasted to still be a type with good potential for development when the demand still tends to increase and the supply for this type still has good room for development. A number of new industrial park investment projects approved for investment and implementation will add new supply to the market in the future.

 

VIRAC provides a variety of research reports on many economic sectors in Vietnam; including analysis from overview to details of the market, products – services according to the needs of customers in many different fields.

 

Vietnam Industry Research and Consulting Joint Stock Company is confident to be a reliable companion of your business on the way to conquer the Vietnamese market.

 

 

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