While the on-going COVID-19 situation has caused problems for the housing markets in neighboring countries, the impact in Vietnam will be relatively minor by comparison. While the total number of transactions fell recently, Vietnam home prices have remained steady and experts believe they won’t drop moving forward.
According to CBRE Vietnam, average housing prices in the country rose actually increased by around four percent during the crisis. The country’s response to COVID-19 has been lauded by governments around the world and Vietnam has already been able to ease social distancing measures.
Meanwhile, the Viet Nam Association of Realtors told the Vietnam Investment Review that market supply and transaction volume in the first quarter were both at their lowest levels since 2016. Developers did not bring any new projects to the market due to economic uncertainty.
Property buyers have been waiting on the sidelines as well. Their hope is that the on-going COVID-19 pandemic would cause prices drop. This happened during the Asian Financial Crisis in 1997 and the Global Financial Crisis in 2008, but experts aren’t expecting Vietnam home prices to sink this time around.
Real estate expert Dang Hung Vo explained to VIR that the country’s property market was quiet in the first quarter due in large part to the government’s social distancing measures. However, there is still strong demand and limited supply which means the long-term impact of COVID-19 will be minimal. Some homebuilders have delayed project launches in light of the current situation and this will cause supply to shrink even further.
According to Vu Cuong Quyet, Northern Green Land Real Estate and Services Joint Stock Company General Director, developers are looking at alternatives to lowering prices in order to navigate short-term issues facing the market. These include launching special promotions, such as offering free furniture, that appeal to buyers.