What type of real estate do investors prioritize in 2024?

Although the real estate market is facing many difficulties, the demand for real estate ownership of Vietnamese people is still present. In particular, apartments and private houses will be prioritized in the portfolio of investors because they can create regular cash flow and maintain stable price levels.

That was the information shared at the Vietnam Real Estate Conference (VRES 2023) with the theme "Shaping the future" taking place on December 12 in Hanoi.

The trend of using more data

At the VRES 2023 Conference, experts commented that currently, apartments are still having a fast and stable rate of profit growth (price growth rate plus rental yield) over the past ten years. Market data researched by Batdongsan.com.vn shows that as of the second quarter of 2023, apartment investment profits increased by 97% compared to the beginning of 2015.

The evidence is that apartments have had a fast and stable growth rate of profit margin (price growth rate plus rental yield) over the past ten years. Market data as of the second quarter of 2023, apartment investment profits increased by 97% compared to the beginning of 2015.

Mr. Bach Duong - General Director of Batdongsan.com.vn, said that through research on real estate consumer psychology and trends (CSS) in the first half of 2024, this unit recorded that about 65% of respondents planned to buy real estate in the next year; of which 60% of people bought for investment.

“Land is the type of property that potential buyers are most interested in (33%), followed by private houses (26%) and apartments (24%),” Mr. Duong emphasized.

For more information, Deputy General Director of Batdongsan.com.vn Nguyen Quoc Anh said that through research, apartments are currently experiencing a rapid and stable growth rate of profit margin (price increase rate plus rental yield) over the past ten years. As of the second quarter of 2023, apartment investment profits increased by 97% compared to early 2015.

For land, in the coming time, it is likely that the land price level will be adjusted down, especially for large plots of land. However, in the long term, land prices may continue to increase and transactions will return, because real estate prices depend on other factors such as infrastructure development, economic growth, and people's income.

However, when mentioning the trends that “shape the future” of the real estate industry, expert Nguyen Quoc Anh also noted that the real estate market is and will depend on certain policy shifts. Accordingly, buyers and investors are more demanding in terms of quality and legality of projects.

“They tend to use more data to make decisions. That is data with many years of history on price fluctuations, investment profits and supply - demand. When customers have more information, they will become wiser; investors and businesses also need to rely more on data and market research to offer quality products at suitable prices,” Mr. Quoc Anh stated his opinion.

Need determination to overcome financial pressure

In addition to strict requirements for project information, real estate experts believe that in the coming time, customers will also pay more attention to the regulation that project investors can only collect deposits of no more than 5% of the selling or leasing price from customers when the house or construction project has met all the conditions to be put into business.

According to Deputy General Director of Batdongsan.com.vn Nguyen Quoc Anh, the above regulation on deposit amount will help future projects ensure better quality as well as ensure the rights of home buyers. However, the regulation also poses challenges for investors in mobilizing cash flow to build projects.

“Therefore, the Government needs to have measures to support investors, especially in procedures such as applying for licenses or borrowing capital, to both ensure sustainable supply and create a safe environment for buyers,” Mr. Nguyen Quoc Anh proposed.

Sharing this view, Dr. Can Van Luc, Chief Economist of BIDV (Member of the National Financial and Monetary Policy Advisory Council) said that in order to anticipate real estate trends in the coming time, businesses operating in the real estate and housing sectors need to continue to promote the story of "restructuring," including: restructuring of operations, products, markets, investment portfolios and projects.

On the other hand, businesses need to be determined to overcome financial pressure, including all debt-related obligations. On the one hand, businesses need to negotiate to defer debt, and on the other hand, restructure finances to ensure timely debt repayment.

“Even if necessary, businesses sell real estate at a lower discount to ensure cash flow. Along with that, businesses need to be proactive in the greening and digitalization process, which is both an immediate solution and a long-term measure to develop a transparent and sustainable real estate market,” Mr. Luc shared.