Vietnam real estate market 2011 report

Vietnam real estate market 2011 report summary: Housing prices (including apartments, adjacent houses and villas) in 2011 tended to go down by averagely 30%-40% from early 2011 in Hanoi and 5-10% in HCM City.

In Hanoi

Within one year from early 2009 to early 2010, apartment price had increased rapidly by 40%, then stood at high level in 2010. Till the end of 2011, apartment price decreased 10-30% from early 2011, but falling slightly over early 2010. Currently,  apartment  average  price  in  Ha  Dong  district  is ranging around 17 – 22 million  VND/m2, in Tu Liem district (My Dinh) ranging  25–32 million VND/m2, in Dong Da at 30-40 million VND/m2, Hai Ba Trung  (Minh Khai) at 24 – 33 million VND/m2,…

In HCM City

There  were  no  strong  discounts  and  sells-off  in  the  past time but  the market  is still witnessing downward  tendency, discounts  and  payment  reschedules. These forms aimed at supporting customers to stipulate the real demands.  In addition, businesses are accelerating the recovery of cash flows and sale of outstanding projects.  In December, there were three typical projects for this trend namely Petro Land Tower apartment project in district 7, An Tien (Gold House) apartment project and V-Citi Light apartment project.

Project land market

Land price from early 2009 to early 2010 in Hanoi surged sharply 70–80%, even some projects saw double increase. Till the end of 2011, project land price declined  by  30  –  40%  from  early  2011  but remained  unchanged  from  January  2010.  Presently, land price in Gia Lam district is averagely at 45-65 million VND/m2
; Ha Dong district at 45-50 million VND/m2, even up to 80 – 100 million VND/m2
, Hoai Duc at 24-35 million VND/m2, Me Linh at 12-18 million VND/m2,…

Office for lease

Office market in HCM City still saw difference between old and new buildings. New projects such as Bitexco and Vincom still posted high vacancy ratio while old buildings in the central area reached the fulfillment of over 90%. Regarding the office rental price, this is the third year; office rental charges have continued to fall and posted the strongest decline in the fourth quarter of 2011. According to CBRE, average rental price for Grade A is currently at $32, Grade B at $18 and Grade C at $14. New supply is constantly increasing. In Hanoi,  after  three  quarters  of  relative  stability, the  rental  price  tended  to  increase  slightly  and market performance was quite good.  In the fourth quarter of 2011, office market saw clear downtrend. New supply continued to increase at approximately 40% from Q4 previous year (figures from Savills).Average rental price decreased by over 2% from the previous quarter and 3-4% over the same period of previous year. The rental rate is also decreasing; the statistics of Savills showed in Q4 the rental rate reached 75%, marking the lowest level in the year. Market is still under pressure from abundant new supply from newly-completed  large  projects  such as Keangnam, Indochina Plaza,…

Retail market

Retail market by the end of the year saw many high-class  projects  in  operations  such  as  Vincom Centre  Long  Bien,  Savico  Mall  Long  Bien  and Parkson Landmark Keangnam,… It is easy to see that the supply is constantly increasing and it is estimated to welcome 1.5 million m2 of new floor area in the next three years, of which in 2014 Thanh Xuan district is forecasted to provide the biggest area with about 50% of the total supply. This will create competitive pressure in rental price in the following years.