Adam Bury, senior manager of research and consulting for CB Richard Ellis Vietnam (CBRE), said at the company’s quarterly market overview held in HCMC on Wednesday that the second quarter saw secondary prices down across all segments as a result of the challenging financial conditions.
Citing the company’s market research, Bury said the market recorded a decline in price at 1.6% in luxury projects, 2.5% in high-end segment and nearly 5% in mid-end projects as compared with the same period of last year.
The number of new launches in the second quarter decreased by 12.5% quarter-on-quarter, with a total of nearly 5,000 units from eight projects launched.
For example, CT Plaza project in District 3 was launched with prices ranging from US$4,500-4,800 per square meter. Meanwhile two projects – Sun City-Saigon Complex in District 4 and Tropic Garden in District 2 – joined the market with prices from US$1,400 to US$2,250 per square meter.
Savills Vietnam on Wednesday released its quarterly report, saying the current credit tightening policy had lowered homebuyers’ affordability, thus low-priced apartments were seeing the most transactions.
Savills said small sized apartments with one to two bedrooms was the preferred choice of buyers, and the market saw more than 50% of the apartments sold with prices under US$750 per square meter.
Bury of CBRE said the current difficulties were apparent in the primary sector, where developers had to offer innovative schemes in order to lure buyers back into the market.
Commenting on the market, Bury said, fewer residential buyers could complete all cash transactions, and mortgage loans were less popular than ever before. Buyers were putting pressure on developers to offer discounted asking prices or more flexible payment terms.
He, however, projected that purchasing power may not increase immediately when interest rates are relaxed as buyers’ confidence is lower than in the past couple of years.
Therefore, through the end of the year new developments in all sectors will push back launch dates as developers are waiting for a brighter outlook in the market, and those who have already launched or forced to launch projects will continue to try new innovative tactics to stoke sales.
According to Savills, there are 32 apartment projects with some 26,000 units in total expected to launch in the next two quarters. However, the number of units launched will be far below the total as large projects will launch their products in multiple phases.