The question "When will the land be hot again" is probably interesting to many investors. Many investors have put money into this segment and are waiting for new signals from the market.
After the prolonged fever, the housing market in the suburbs and neighboring Ho Chi Minh City provinces has witnessed a sharp drop in liquidity. Land plots, the segment that recorded strong price fluctuations in recent years, are no longer as easy to "eat at the same time" as before.
At the end of 2022, due to the influence of tight monetary policy and "wounds" accumulated after nearly half a decade due to speculative bubbles, the real estate market, in general, and land plots, in particular, fell into difficulties.
Specifically, in 2016-2020, especially from 2021 to early 2022, family members flocked to "hunt for land", causing prices to increase continuously. As a result, the bubble deflated, liquidity fell freely, and many investors borrowed money not in time to "return to the shore", facing the risk of heavy losses.
Before the question of when the market can recover, many experts believe that the provinces' garden and agricultural land will take longer to recover than other real estate types.
Recently, the positive information from lowering interest rates and opening credit rooms is expected by investors to affect the land plot segment. In the southern land plot market, the wave of cutting losses has been lower than in the first period of 2023. This is creating a gradually stabilizing sentiment among investors. Many people expect demand to return from the end of this year.
The market report for the first 6 months of 2023 of the Ministry of Construction recently noted that real estate transactions over the past time have mainly focused on the land plot segment. However, these transactions all reduced prices compared to the first period of 2022 from 10-30%.
The report shows that in terms of the number of real estate transactions in the first 6 months of the year, a total of only about 187,000 successful transactions, a decrease of 63.87%, mainly concentrated in the land plot segment, of which the number of transactions in apartments and individual houses decreased by 59.31% compared to the last 6 months of 2022.
According to the Ministry of Construction report, in the coming time, the Ministry of Construction will continue to perform the tasks of the Prime Minister's Working Group on reviewing, urging and guiding to remove difficulties and obstacles in the implementation of real estate projects for localities and businesses.
Recently, Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, said that around the end of the third quarter of 2023, transactions will appear rhythmically again, with more supply to the market. Regarding the selling price, land plots in areas where the price has increased too strongly will continue to decrease to adjust to the appropriate level. On the contrary, areas with few projects are likely to increase prices.
In 2023, experts say that there will not be a land fever in many localities like in early 2022. The market needs to converge many factors regarding supply and demand, information, infrastructure, and capital flow ... to explode the land fever. That process takes about 4-5 years. Some experts believe that land fever may occur in 2027 or 2028 when the market is good again, transactions are active, and housing prices increase sharply.
However, by the end of 2023, when public investment flows are strongly disbursed, and infrastructure is completed in some areas, there will be opportunities for land prices in some areas to increase slightly. Some small, localized land fevers occurring in a short time may appear. However, the price will not increase afterward, and the market will go sideways for several years.
There are also many opinions that the real estate market of Vietnam in this period will not repeat the crisis cycle in 2012. Currently, urban development is high, and infrastructure investment is strong, demand for housing is still high, interest rates are low. These factors create great motivation for the market's ability to recover.
Currently, investor sentiment is more cautious when observing the market. The purchasing power of land plots still needs to grow, so it is difficult for this segment to surge suddenly in the short term.
