Saigon apartment sales dip to lowest in 18 months
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The third quarter of 2018 saw apartment liquidity in Saigon fall to the lowest level in six consecutive quarters. According to property services provider Savills Vietnam, only 10,000 apartments were traded in Saigon in the third quarter of this year. The apartment sales were down 30 percent from last quarter and down 13 percent year-on-year.
Grace C apartments took up 54 percent of total sales.
Savills forecasts that by 2020, more than 124,000 apartments will be offered in the market, with Districts 2 and 9 in the eastern part of the city accounting for 55 percent of total supply.
Meanwhile, another recent report compiled by property services provider CBRE Vietnam has reported even lower sales than Savills, at only 6,568 apartments sold in Q3. According to CBRE, sales fell 7 percent from the previous quarter, and was down 16 percent over the same period in 2017.
Large disparities between real estate reports have existed between these two companies and are attributed to differences in statistical methodology.
Recently, the Ho Chi Minh City Real Estate Association (HoREA) released a report on the housing market saying that as of October 31, 2018, there has been a continuous downwards momentum in apartment supply from the beginning of the year.
During this period, total housing supply in the Saigon market fell 39.2 percent. The supply of high-end luxury apartments fell 9.6 percent, and that of midrange apartments by 37.5 percent. But the biggest decrease in supply was in the low-priced apartment segment, which was down 68 percent.
The association warned that the structure of real estate supply showed a serious disequilibrium in the market, with low priced apartments taking up only 19.3 percent of total supply while luxury apartments take up a third.
This showed a mismatch between demand and supply, posing a risk to sustainable development and social welfare, it said.
Questions & Answers
Q.What percentage of total apartment sales in the third quarter were for Grace C apartments?
What percentage of total apartment sales in the third quarter were for Grace C apartments?
Grace C apartments constituted 54 percent of all sales during the third quarter of 2018. This made them the majority share of the apartments traded in Saigon according to Savills Vietnam data.
Q.Which specific districts are expected to account for most of the new apartment supply by 2020?
Which specific districts are expected to account for most of the new apartment supply by 2020?
Districts 2 and 9, both located in the eastern part of Saigon, are predicted to provide 55 percent of the total new supply. Savills forecasts this significant increase in apartments by 2020.
Q.Why do reports from Savills and CBRE show different sales figures for the third quarter?
Why do reports from Savills and CBRE show different sales figures for the third quarter?
The disparities in sales figures between the two property services providers are attributed to differences in their statistical methodology. These variations in reporting have been a consistent issue between the companies.
Q.Which segment of the housing market experienced the largest decrease in supply from the beginning of the year?
Which segment of the housing market experienced the largest decrease in supply from the beginning of the year?
The low-priced apartment segment saw the biggest fall in supply, decreasing by 68 percent. This decline was much steeper than that for high-end luxury or midrange apartments.
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