According to JLL, in the fourth quarter of 2018, the number of officially opened apartments in Ho Chi Minh city (HCMC) was 8,300 units, however 99% of them went on sale in the previous second and third quarters.
“Apartment: Take-up was more than 8,800 units, making the total sold in 2018 at 40,032 units, lower 13.8% YoY. The sale rate, however, showed a positive improvement with the record figure of 95.0% by end of the year", JLL recorded.
In terms of selling price of the primary market, apartment’s prices between current projects were stable on a quarterly basis, especially in the high-end and affordable segments. The mid-end saw an impressive price increase, from 3% to 6% quarterly.
In the secondary market, capitalization profit for a secondary investor was considered successful in 2018, typically at 9-12% by year.
The competition in the housing segment will be very fierce in 2019.
In 2019, 45,000 units are expected to be offered to the market, mainly from projects that have been approved for construction and sale in the previous quarters.
For villas and townhouses in the fourth quarter of 2018, new supply of HCMC market reached 118 units. This is the record low launching amount since 2014 as large-scale land sites are scarce. However, demand remained strong with 340 units sold in 2018, mostly from existing projects, accounted for 92%, the all-time high level.
In the primary market, it was a good year when price continued the upward trend at 14% YoY, and in the secondary market, selling prices generally improved across the city, at 3.2% QoQ. “New villas/townhouses supply are expected to reach 4,500 units in 2019”, the report emphasized.
JLL gave a positive forecast on both villa/townhouse and apartment markets when it is believed that sales rates will remain high at 90% and 85%, respectively.
Meanwhile in the fourth quarter of 2018 in HCMC, “there were 23 new projects and 13 next phases from active projects, supplied over 9,500 units. There were over 18,300 primary units, down 3% QoQ and 44% YoY”, Savills reported.
Sales reached 11,000 units, up 10% QoQ but down 27% YoY. Absorption rate peaked at 60%, up 7 ppts QoQ and 14 ppts YoY. Grade C was the driver with 58% of transactions and an absorption rate of 64%.
Savills estimated that more than 154,000 apartments from 100 projects will be sold by 2021, of which more than 66,000 units will be purchased in 2019.
For villas/townhouses, 22,650 dwellings/plots are projected to enter the market between 2019 and 2021. Suburban districts like District 9, Binh Tan and Binh Chanh will contribute 56% of future supply.
In addition, the latest report of Ho Chi Minh city Real Estate Association stated that the 2019 market will have a shortage of land fund and projects’ supply in the affordable, public, and mid-end segments. These divisions continue to lead the market because of the highest liquidity.
At the same time, high-end housing segment is showing signs of oversupply. The competition in this division will be very fierce in the coming time, and the advantages will lie on the side of projects with prime locations, and green, smart developments. The People’s Committee of HCMC recently decided to limit new licenses for projects in the city center, leading to the boosted values of high-end real estate products.
