It is high time for customers to decide to buy accommodation, when the price is at its lowest.
All signs point to end users taking the plunge and buying accommodation. Reduced prices and plenty of products meant there was never a better time to buy, said Ministry of Construction’s Real Estate and Housing Market Management Bureau deputy director Vu Xuan Thien.
“Prices are reducing, more products are being launched by developers and customers are being offered more incentives,” Thien said. In Ho Chi Minh City, developers of many mid-end projects have been offering VND15 million per square metre since 2009, while in Hanoi the average price for mid-end apartments stood at more than VND20 million ($952) per square metre in the last three years.
However, since 2012’s second quarter, many investors cut their prices by 20 to 30 per cent to increase sales. Especially more developers are offering apartments with prices starting at VND14 million ($666), the lowest in the capital.
Newly emerging Ha Dong district in the capital is the first place which developers offer this lowest prices, at $660 per square metre, while the majority of lower price projects are located in Hadong and Thanh Tri districts.
Hanoi Real Estate Club chairman Nguyen Huu Cuong said Hanoi’s property market had been in a downturn since last year and it was at its lowest point when the government applied the credit tightening at the end of 2011.
“It is high time for customers to decide to buy accommodation, when the price is at its lowest,” Cuong said. He said the decreasing interest rate trend could be further kept until the end of 2012.
Apart from supporting from bankers, developers have offering many other incentives, instead of directly reducing prices.
The majority of incentives are valuable presents such as cars, motorcycles, electronic appliances or furniture. Also, some projects offer special added-value packages for their customers such as privilege membership cards.
According to the Hanoi Construction Department, after more than 18 months with few transactions, Hanoi’s real estate market was at its lowest point. “Developers cannot sell their products, speculators cannot recover their investments and transaction centres are bankrupted,” said Tran Hop Dung, head of Economic Management Division under the Hanoi Construction Department.
Dung said that among more than 500 existing transaction centres, during the last 12 months, more than 120 centres closed and 200 centres had received no transactions.
“The supply is exceeding the demand and the market now needs time to disburse all of the accommodation,” Dung said.