3 scenarios for the real estate market in 2022
The COVID-19 pandemic is still a risk to consider as an uncertain event and it can have strong impact on the real estate market. Consumers need to wisely choose reputable investors.
According to PGS.TS.Tran Kim Chung, former Deputy Director The Central Institute for Economic Management (CIEM), Vietnam’s real estate market in 2021 has many different nuances. Industrial real estate continued to do well, but rental real estate declined sharply while super-luxury and high-end real estate surged despite the pandemic. Land plots at the beginning of the year and at the end of the year showed signs of bubble price increases due to speculation while real estate corporate bonds are based mainly on high interest rates, so they should be warned. In particular, the successful land auction price at 4 land lots in Thu Thiem (HCMC) has reached a sudden high.
Forecast for 2022, Prof. Dr. Tran Kim Chung said that the COVID-19 pandemic is still a risk that must be taken into account as an uncertain event and it can have a strong impact on the real estate market.
Affordable, cheap housing is disappearing completely in the market HCM City
The domestic context in 2022 has many points that can affect the real estate market to consider, That is, foreign investment may continue to operate in Vietnam as Vietnam is still the destination of capital leaving China due to the volatile real estate market as a result of Evergrande’s bankruptcy. and adjust policies with the “big” technology. Besides, the new generation trade agreements signed by Vietnam continue to take effect, so Vietnam continues to have new foreign investment attractions.
Moreover, the trend Vietnam’s economic development is showing signs of increasing under the impact of economic stimulus packages as well as infrastructure investment packages. In addition, Vietnam has actively improved the legal system in the direction of removing barriers and facilitating the business environment, so the economy has a new development momentum and as a result, the real estate market can new function.
PGS.TS. Tran Kim Chung offers 3 scenarios for the real estate market in 2022:
Positive scenario: Real estate market in 2022 and period 2022-2025 will enter a new development cycle with the assumption: COVID-19 is contained ; the third (and even fourth…) injection is actively deployed; besides, the economy reopened; some necessary mechanisms and policies are awaited (condotel-officetel); use land for corridors of infrastructure works put into auction for construction according to planning, create capital for infrastructure development; re-mortgage system; mutual savings fund system…), with land and real estate issued; world and regional economic stability; real estate bonds and land auctions, real estate when land allocation is well managed….
“This is an expected scenario but a feasible condition requires effort and hard work. participation of many stakeholders and there are also uncertain factors”, Assoc. Tran Kim Chung said.
Assoc. )
Negative scenario: the real estate market will have difficult movements if one or Some of the following conditional factors appear: the COVID-19 epidemic is complicated and the economy is not performing as expected; policies on land and real estate have not changed positively; the world economy and the region have complicated developments; macroeconomic difficulties.
“This is an undesirable scenario, the probability is low, but it is likely to happen”, PGS. Dr. Tran Kim Chung commented.
Neutral scenario: This is the scenario in somewhere between a positive and a negative scenario is possible. The variation of this scenario lies in more or less impact conditions occur. However, the uncertainty factor about COVID-19 in 2022 is considered to have a very strong impact on the real estate market.
According to PGS. Dr. Tran Kim Chung, in the current context and trend, the real estate market will develop in a positive direction.
From the perspective of many years of research, Mr. General suggestion to real estate developers, creating a land fund of enterprises is the key in the current period.
“The year 2022 will be the pivotal year in the state transition. economy from pandemic response to pandemic control. The economy will enter a new stage of development, so the real estate market will also have a new direction. Having a land fund to accompany the new development phase is very decisive,” said Mr. Chung.
For consumers and secondary investors, Mr. Chung said. That, in 2022, there will be no major changes, but secondary investors and consumers need to wisely choose reputable, potential and good project developers. Investing in large risky projects may not bring the desired results.
“In 2022, the market will see positive changes rather than limited warnings. . However, the COVID pandemic is still a risk that must be taken into account as an uncertain event and it can have a strong impact on the real estate market”, PGS. Dr. Tran Kim Chung forecast./.
Diep Diep
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