While the apartment market in Ho Chi Minh City has been quiet of late, the housing and land market in outskirts areas is bustling, pushing up property prices, the Dau Tu (Investment Review) reported yesterday.
Ho Chi Minh city - illustration photo
It cited independent market observers as saying the number of property transactions has recently increased in districts undergoing rapid urbanisation, including Thu Duc, Binh Tan, Binh Chanh and District 12.
They said land prices in these areas range between VND1.5 and VND5 million per square metre and this is considered reasonable, attracting many investors.
Nguyen Thi Yen Hoa, director of the Yen Hoa Real Estate Brokerage Company in Thu Duc District's Hiep Binh Chanh Ward, said the number of people who've bought plots of land in the area has jumped sharply in recent months.
The Hiep Binh Chanh Ward is very close to the city's downtown area, but its development plans are not clear yet. Consequently, most land transactions are happening via unofficial contracts between sellers and buyers. Although this is an unsafe business practice, it has increased in frequency of late, Hoa said.
The selling and buying of land plots at low prices via unofficial contracts was also taking place in Binh Chanh District's Vinh Loc Commune.
Noticing the increased demand, many real estate agents in the area have purchased thousands of square metres of land at cheap prices from locals and divided it into smaller land plots for sale at higher prices, making handsome profits in the bargain, the report said.
It quoted an unnamed broker in Vinh Loc Commune as saying land marketability there was rather high and the price was increasing regularly.
"Despite the fact that infrastructural facilities here have not been completed, I am accumulating some land in the hope of making some profit. Land prices here will rise significantly in the near future," he said.
He said that land in the district has become more attractive since a rumour began making the rounds that part of the Binh Chanh and Binh Tan districts are likely to be combined to create a new urban district under a new plan prepared by the city government.
The Dau Tu report said many real estate investors in the city's outskirt districts have made significant profits recently.
This has been proved by a fact recorded in Binh Tan District, they said.
Some years ago when the land had not been zoned clearly, land plots in Binh Hung Hoa A, Binh Tri Dong A and B were priced at between VND2 million and VND3 million per square metre.
But now, its rates have risen to between VND10 and 15 million, the report said.
It said middle income earners were especially interested in houses and land plots in residential areas at the edge of the city. The demand for properties of this kind has recently risen significantly due to the increasing number of immigrants from provinces to HCM City, said Nguyen Minh Suong, director of the Dai Nam Real Estate Company.
"Purchasing land and houses in the outskirts areas carry high risk because proper plans have not been drawn up for several areas there. However, many people with actual demand of housing still venture to invest into due to their limited cash," said Suong.