Price of land on the rise in HCM City
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Land prices in HCM City and neigbouring provinces are increasing, with real estate industry insiders attributing it to high liquidity.
Nguyễn Quốc Anh, deputy director of Đại Việt Group, said prices have been rising in all districts in the city since the end of last year.
He quoted real estate website batdongsan.com.vn as saying that land prices surged 51 per cent last September.
They are up 34 per cent in Thủ Đức District, 54 per cent in Hóc Môn, 37 per cent in Bình Tân and 13 per cent in District 7.
Anh said that since the end of last year demand has been strong, with both speculators and people with actual housing needs buying.
Nguyễn Thanh Trang of District 7 said she bought land in Bình Tân and made a profit of over 30 per cent within half a year.
Brokers said areas where prices have increased are ones where residential projects are mushrooming or infrastructure would be improved in future.
Explaining further, they said when an apartment or housing project is announced, land prices jump in the vicinity.
A year ago a 60sq.m piece of land in District 9, 15km from downtown, cost VNĐ600 million (US$28,000). Now the same land costs VNĐ800-900 million ($40 million).
Prices in more central parts have risen even more.
For instance, in Linh Đông Ward of Thủ Đức District, 8km from downtown, now costs VNĐ18-25 million ($810-1,100) per square metre. A year ago it was only VNĐ14-16 million ($636-720).
The rise is attributed to the new Phạm Văn Đồng Street which runs to the Gò Dưa traffic intersection.
Furthermore, three apartment projects are being developed on this road.
Districts 7 and Nhà Bè too have seen prices jump after authorities indicated several bridges would be built there and many streets expanded together with flyovers and tunnels.
Neighbouring provinces like Đồng Nai, Bình Dương, and Long An where tourism is developing are also seeing land prices go up sharply.
Brokers said liquidity is very good in these markets, with buyers coming from HCM City and elsewhere and acquiring lands without haggling much.
But as prices go up, some are reminded of the property bubble that burst in 2008-10.
Lê Hoàng Châu, chairman of the HCM City Real Estate Association, admitted that the risk of a bubble exists and said buyers should exercise caution when investing.
Questions & Answers
Q.What is the primary reason industry insiders give for the increase in land prices in HCM City?
What is the primary reason industry insiders give for the increase in land prices in HCM City?
Real estate industry insiders attribute the rising land prices in HCM City and neighbouring provinces primarily to high liquidity. Strong demand from both speculators and people needing housing has been noted since the end of last year.
Q.Which specific infrastructure developments are mentioned as contributing to land price increases in certain areas?
Which specific infrastructure developments are mentioned as contributing to land price increases in certain areas?
The new Phạm Văn Đồng Street, leading to the Gò Dưa traffic intersection, is credited with raising prices in Thủ Đức District. Also, planned bridges, street expansions, flyovers, and tunnels are boosting prices in Districts 7 and Nhà Bè.
Q.Is there any concern among experts about a potential property bubble due to these price increases?
Is there any concern among experts about a potential property bubble due to these price increases?
Yes, Lê Hoàng Châu, chairman of the HCM City Real Estate Association, acknowledges the risk of a bubble forming. He advises buyers to exercise caution when considering investments, recalling the property bubble that burst between 2008 and 2010.