Chair of the Vietnam Association of Realtors (VARS) Nguyen Van Dinh said that since 2018 new supply has been decreasing, and products are mostly high-end.

VARS reported that nearly 200,000 new products were launched in 2018, while supply fell by half to 110,000 in 2019. 

In 2020, when the Covid-19 pandemic broke out, supply shortages continued, falling to 90,000, or 50 percent of 2018.

In early 2021, the market saw a series of "fever" spells on a large scale. The number of real estate investors joining the market increased to an all-time high, while supply continued to drop to 50,000 products.

While supply dropped sharply, prices were pushed up to overly high levels. Higher input costs such as building materials, equipment, machines, labor force, land price, capital costs and high inflation put pressure on real estate prices.

“Though real estate prices decreased a little in the last months of the year, they were still much higher than 2018,” Dinh said.

As for the future, he mentioned two scenarios. First, difficulties would still exist because of capital shortages.

Second, after Tet, the government may apply correction policies. The market could then warm up and become stable until the end of the year. 

Can Van Luc, Chief Economist of BIDV, believes the real estate market will continue to be quiet and  only recover and be healthier due to improvements in the legal environment; bright economic growth prospects; growth in trade, investment and consumer activities; comprehensive development of infrastructure; digital transformation and technology application; and diversification of financial resources.

Luc said in addition to traditional market segments (housing, industrial zones, resort real estate, offices), products in the market will be more diverse, with the appearance of market segments such as cemetery, digital, spiritual, and health real estate.

Dinh said that, to adapt to new circumstances, real estate firms must restructure products to make them more suitable to market demand, and focus on more reasonable prices at new projects. If so, liquidity will improve.

Hong Khanh