Real estate market forecast in the second half of 2022

Statistics from the Vietnam Association of Realtors (VARS) show that more than half of the supply of residential real estate belongs to the segment of low-rise apartments and land plots, while affordable apartments are almost absent.

Apartment real estate has many conditions to set a new price level in the second half of this year. Uncertainties in the channel of raising capital from corporate bonds make it difficult for project owners to implement projects.

In addition, the slow granting of permits for projects once again caused the supply of residential real estate to be difficult. For individual investors and households owning real estate, the risk of global inflation makes them even more desirable to hold assets instead of selling and collecting money. The above factors predict that the residential real estate market in the second half of 2022 will face difficulties in supply.

Meanwhile, inflation also pushes people to buy real estate to hold value, in which land plots and low-rise apartments are given priority. Besides, there is a clear economic recovery after the Covid-19 sweep, causing the urbanization rate that has been interrupted for the past two years to be restored again.

In addition, the amount of population pouring into the city causes the demand for housing to increase naturally. Tight supply while demand is boosted are the factors that cause real estate prices in the apartment segment to establish a new price level in the second half of this year, even though transactions will be quiet.

VARS forecasts that, eliminating land fevers such as late 2021 and early 2022, residential real estate prices will increase by an average of 10% in the second half of 2022.

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According to the Vietnam Association of Realtors, Decree 35/2022/ND-CP issued by the Government at the end of May is expected by real estate investors to accelerate the speed of licensing industrial park projects. and economic zones in the near future.

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The war between Russia and Ukraine along with China’s “zero Covid” policy has affected the global economy; broken production chain, increased costs and transportation time…

Thereby, promoting high demand for warehouses and factories in consumption markets. Vietnam is one of the countries that enjoys a significant comparative advantage in the increasingly unstable and complex world geopolitical situation.

So far, Apple has moved 11 of its production plants from Taiwan to Vietnam. Samsung, which accounts for the largest proportion of exports in the country, has also decided to build the largest research and development center in Southeast Asia right in Hanoi with an investment of 220 million USD, and plans to expand factory in Bac Ninh, Thai Nguyen.

In the second half of the year, the industrial real estate segment is forecast to prosper in both supply and demand. The occupancy rate of 80-85% in industrial parks will continue to be maintained in the second half of this year, while rental rates are forecast to remain unchanged.

VARS said that changes in the shopping habits of consumers after the pandemic made the situation of renting and leasing shophouses difficult. Shophouse rental rates are forecast to continue to decrease by about 15-20% in the second half of this year.

Shophouse is still one of the favorite investment properties thanks to the good price increase when the economy is prosperous and the infrastructure of projects is gradually completed, especially in crowded residential areas. However, in the face of the situation that shophouse rents are at risk of plummeting, the shophouse value may level off in the near future.

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Source: CafeF

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