Condo section recovers in southern Vietnam, land plots slow

April saw marked improvement in the supply and absorption of apartments in Ho Chi Minh City surrounding areas, but trade in land plots remained sluggish, says a new report.

Prepared by property consultants DKRA Vietnam, the report says the apartment segment showed signs of bouncing back with new supplies increasing 3.8 times over March and 2.8 times over the same period in 2023.

The new supply included 1,597 units coming from one new project and different phases of six existing projects. Of these, 819 units were sold, equivalent to 51% of the figure in the same period last year.

New supply mainly came from HCMC and the provinces of Binh Duong and Long An. Binh Duong accounted for 80% of total new supply and 71% of new sales in the area, mostly from a project in Di An town.

Meanwhile the provinces of Dong Nai, Ba Ria-Vung Tau and Tay Ninh did not record any new supply for sale in April.

DKRA Vietnam said investors continued to offer quick payment discounts, payment term extensions and gifts to stimulate demand. “There was no great fluctuation in primary and secondary selling prices. Market liquidity came from projects with full legal status and rapid construction progress.”

It noted that apartment prices in HCMC were still very high, with the lowest being VND50.8 million ($1,996) per square meter and the highest hitting VND337 million ($12,340).

In Binh Duong, the lowest price was VND30.8 million per sqm while the highest was nearly VND60 million. Long An saw more affordable prices, with lowest and highest prices of VND21.7 million and VND24.5 million, respectively.

In contrast to the recovery of the apartment segment, the land plot segment remained gloomy. New supply and sales in April continued to be low, plunging 71% and 97% respectively over the same period last year.

Four projects (one new and three existing projects) provided the market with 79 plots in April, but only eight were sold. The number of land plots in Binh Duong accounted for more than 50% of the total supply, followed by Tay Ninh (31.7%), HCMC (15.2%), and Long An (2.5%).

HCMC recorded lowest and highest land plot prices of VND33.6 million ($1,320) and VND57.5 million ($2,259), respectively. Corresponding figures were VND14.3 million and VND15.5 million in Binh Duong; and VND4.1 million and VND5.2 million in Tay Ninh. Long An reported average land plot prices of VND19.4 million per sqm.

The report said the land plot segment has remained gloomy since last year. One large firm in Long An said that over the last year, it had no new land plot project to sell. It only had plots from “old baskets”, but there were no buyers for these despite many incentives being offered.

Positive signs were seen in the townhouses and villas segment. New supply increased 3.6 times year-on-year and about 12.3 times over March, with Binh Duong accounting for 97% and the rest coming from HCMC.

Different phases of three existing projects provided the market with 184 units, of which 63 were sold. In this segment the lowest and highest prices in HCMC were VND63.2 billion ($2.48 million) and VND73.2 billion ($2.87 million), respectively. Corresponding figures in Binh Duong were VND3.3 billion and VND12.3 billion, respectively.

The DKRA Vietnam report said market demand had improved a lot since the beginning of the year, with Binh Duong recording about 95% of new transactions. It said the following months were likely to see supply and sales maintain positive growth in this segment.