Some suggestions to develop the real estate market in Ho Chi Minh City. Hai Phong
ABOUT HAI PHONG REAL ESTATE MARKET 2020
As a first class city, Hai Phong has a total natural area of over 150 thousand km2, located in the Northern key economic region, is the main gate facing the sea of the Northern provinces, and is also an economic center general science - technology of the region. This is also a port city with more than 2 million people in the process of innovation and strong development. Hai Phong has the characteristics of a port city, a seaport, sea tourism and economic sectors related to transport, import - export and processing, immigrants and tourists. Therefore, the real estate market in Hai Phong has a diverse need in terms of development and development in many different directions. In recent years, the face of the city has changed a lot with the appearance of shopping centers and new urban areas. In particular, the real estate sector as a "wave" is attracting a lot of big investors, with projects with investment up to trillions of dong.
According to City Statistics Office. Hai Phong, among the major real estate projects being implemented to date, the most prominent are: Vincom Plaza Commercial Center, Office and High-class Apartment Project; Project of high-class tourist and entertainment area in Hon Dau island of Him Lam Joint Stock Company; Nguyen Kim Commercial, Service and Entertainment Center Project; VSIP Urban and Industrial Project (Singapore), Our City Project (Hong Kong - China). Particularly, the Project of Entertainment, Housing and Ecological Park of Vu Yen Island (Vingroup Group) has a scale of 19,000 billion VND; Vinhomes Riverside Hai Phong Complex Urban Project (Vingroup Corporation as an investor with a total investment of VND 10,000 billion was started on March 4, 2019).
Besides, the new apartment buildings have also changed the mindset and view of the city's residents. Hai Phong. These include: Vinhomes Riverside, Sunflower apartment, TD Plaza Hai Phong, H-Tower, lot 7C and 27, Pruska Town An Dong codo, apartment, Kien An apartment ... And in 2020 these are new apartments is Hoang Huy Riverside near Cau Quay bridge, H3H3 Dong Quoc Binh ( belong goverment ) about 1,000 small apartments, Minato residence and Vinhomes Marina near Cau Rao bridge...
Currently, real estate prices in Hai Phong have changed greatly in the trend of increasingly modern and large scale. According to City Real Estate Association. Hai Phong, in 2019, luxury apartments were priced around 30 million VND / m2 (about over 3 billion VND / 100m2 unit) and affordable apartments cost 10-15 million VND / m2. The price difference between the central and suburban areas is gradually narrowing. In the central areas, apartments from 60m2 to 80m2 cost more than 1 billion, while away from the city center about 10km, apartments from 40m2-60m2 cost about 400 million to 500 million.
PROBLEMS TO SET OUT
However, the development of Hai Phong real estate market also raises a number of issues, as follows:
One is stable, but lacks groundbreaking. According to Mr. Nguyen Ngoc Thanh, Chairman of City Real Estate Association. Hai Phong, according to the law, real estate activities of a locality, an area will accompany, or after 1 step compared to the socio-economic development of that region.
Its evolution will depend on the housing needs of the local residents. Experience shows that where there is a vibrant market, strong purchasing power is where there is a population growth rate, or where real estate products have the ability to create valuable benefits, profits for buyers or investors. For both of these two factors, the Hai Phong market is lacking or unclear, so transactions in the real estate segment of the City are generally less active.
Second, real estate in Hai Phong in recent years has increased rapidly, but still in a state that does not meet the housing needs of the majority of workers. According to City Statistics Office. Hai Phong, by the end of 2016, Hai Phong has attracted 2.8 billion USD of FDI, including 19 projects from Korean investors, 05 projects of Japanese investors ...
Besides, the City has also attracted a lot of big FDI projects in industrial parks and economic zones, such as: LGE, LGD, Bridgestone, FUJI XEROX, Regina Miracle International ... The increase of FDI projects Hai Phong has been increasing the demand for human resources and bringing the population movement to the City. By the end of 2019, about 4,800 foreigners are living and working in Hai Phong. Besides, the City also has about 62,000 workers who are working in industrial parks and clusters. In particular, only about 30% of workers can afford housing, the remaining 70% (mostly migrant workers) demand housing. However, at present, in the districts of Duong Kinh, Kien An, Do Son, Kien Thuy, An Duong, An Lao and Thuy Nguyen, there are quite a number of concentrated industrial zones and clusters, but none Housing fund for workers
According to the City construction general plan. Hai Phong to 2025 and a vision to 2050 was issued together with Decision No. 1448 / QD-TTg, dated September 16, 2009, the whole city will build and develop 17 economic zones, industrial parks and 15 industrial clusters. In the future, if the entire economic zone, industrial zone and cluster is "filled", attracting about 250,000 laborers, of which a significant portion is suburban, provincial workers, the need to go home in will be very big. Meanwhile, according to the latest statistics of the City Real Estate Association. In Hai Phong, in 2019, the supply of this market is currently only about 1,000 units. As such, Hai Phong as well as many localities across the country have not yet reached the set targets on social housing development for the poor, low-income people in urban areas, and industrial park workers in the Housing Development Strategy. in the country until 2020 and vision to 2030.
Third, there has been an imbalance between housing demand and supply among different market segments. Excess supply in the high-end real estate segment, but there is a shortage of affordable real estate, while the demand for this segment is currently very large. Projects in the Table show that high-cost projects account for the majority, while affordable housing projects, low-end segment are very few.
Fourthly, the central area with high population density, houses built by people with outdated technical infrastructure, living conditions are very much inconvenient. Meanwhile, the old apartment buildings are in dire need of renovation and rebuilding to ensure more safety and convenience for people. According to the Department of Construction City. Hai Phong, by the end of 2019, the City has 64 degraded condominiums (demolition and new construction of 15-28 storeys high) and 2000 small and big apartments are in a state of local damage (needing immediate repairs within the following years).
SOME SOLUTIONS
According to our research, forecasting real estate demand in the coming years in Hai Phong will continue to increase rapidly, especially in apartment segment. The reason is that the land prices of villas and townhouses will continue to increase, but the demand of the market is limited, due to exceeding the ability of people with real needs. Besides, the land fund is increasingly limited, soaring land prices exceed the purchasing power of low- and middle-income families, so City residents
More interested in condominiums.
So, to solve the inadequacies of the real estate market in the city. Hai Phong, the city government and real estate investors need to choose a strategic orientation and solutions to develop the real estate market to meet the housing requirements of all classes of people and develop Hai Phong into a city. Modern, harmonious and environmentally friendly. Detail:
Towards the city. Hai Phong:
Firstly, it is necessary to strictly follow the City construction general planning. Hai Phong to 2025 and vision to 2050. Implementation of the plan must ensure the consistency between the planning of industrial parks, factories and agencies; residential zoning; traffic planning and other technical and social infrastructure facilities of a modern urban city or a coastal city.
Secondly, promoting the development of real estate are condominiums, including high-class, mid-end and affordable apartments. First of all, Hai Phong needs to focus on proposing mechanisms and policies to attract investors to participate in projects to rebuild seriously deteriorated old apartment complexes in order to improve housing for local people. and developing new apartments for the market, contributing to changing the face of the City. In the immediate future, investors need to focus on completing new apartment buildings, such as: 28-storey SHP Lach Tray building (being completed and will be handed over in 2020), Water Font building from 5 storey to 28-storey building ...
Thirdly, investors should be encouraged to build new apartment buildings with 15-28 storeys high to meet the needs of people in the apartments and to serve the clearance of projects. key city. In the coming years, Hai Phong can deploy 260 housing and urban development projects with a scale of nearly 2,600 hectares. Each project should become a complete residential area with technical and social infrastructure, including utilities, such as amusement parks, hospitals, schools, supermarkets, etc. , new people can feel the change and gradually move to modern civilized apartment buildings like in big cities, such as Hanoi and Ho Chi Minh City. Ho Chi Minh.
On the property investors side:
(i) It is necessary to have a reasonable development strategy among high-class to affordable real estate types to meet the needs of different market segments. In particular, businesses instead of developing high-end apartments, now need to build affordable apartments for workers.
(ii) Focus on improving service quality and safety for users and improving the quality of life in apartment buildings.
(iii) Focus on developing rental real estate areas to serve groups of tenants, including high-class apartments for foreigners and low-cost apartments for workers in industrial zones. Karma. In fact, some investors are very sensitive to this market opportunity. For example, the investor of Sun Flower International Village project has started phase III, built 120 new apartments, bringing the total number of apartments to 400. As expected, by May 2019, the apartments This will be completed and put into use.
