Real estate stopped cutting losses, waiting for prices to increase
Towards the end of the year, real estate losses tended to decrease, many landowners chose to hold out when seeing positive signals from the market.
In early October, Joint Stock Bank Branch Director – Ms. Ngoc put up for sale her private house of 38.4 m2 in Phu Nhuan District, Ho Chi Minh City. Now she decided to stop and wait for the market to improve.
She said, this house was initially listed for sale for 5.3 billion VND. According to estimates, after negotiating with the buyer, the transaction can be down to about 5 billion VND, at this price the sale can be closed.
This level has decreased by 20% compared to the peak (2020 – 2021), but many customers came to see it and then negotiated the price down to 3.5-4 billion VND so they could not sell it.
According to the sharing, Ms. Ngoc does not often use this house so she wants to sell it and get her money back. Her finances are debt-free, so she doesn’t have to cut losses at all costs. Therefore, she decided to wait for the market to stabilize before selling again.
Mr. Phuc (residing in Thu Duc City) also stopped selling his land in Thu Dau Mot City after being pressured many times by customers. He said that the land lot purchased in 2021 for 3.6 billion VND, now sold for 3.2 billion VND, is still highly criticized.
“This selling price compared to when I bought it was a loss of 400 million VND, but customers still want to reduce it further. I decided to keep it and wait for the market to recover before selling it,” Mr. Phuc said.
The motivation for Mr. Phuc to keep the property is because bank interest rates have cooled down, he has borrowed money from the bank, and currently does not need to sell his house anymore, so he wants to wait a little longer for the market to improve.
Recently, transaction cessation has become more common, especially after bank interest rates dropped sharply and new legal policies were passed. Most of the products temporarily suspended from trading are small, registered plots of land in residential areas and individual houses in the inner city. Most of the products temporarily suspended from trading are land plots with small areas and individual houses in the inner city.
With the private house segment, the reason for flipping is mainly because the owner adjusted the price previously negotiated with the broker. The owner emphasized that he did not want the price to drop further. As for the land segment, information about the upcoming tightening of land division and separation makes many people expect that the land plots that have been separated and legally completed will be more “valuable”. If they are not financially stuck, the owners want to keep it instead of selling it cheaply at present.
In November, the wave of sales to cut losses on land and individual houses cooled down, and deep discounts of 30-35% were no longer common.
Primary land and housing prices in Ho Chi Minh City and neighboring provinces recorded an average decrease of 3-10% over the same period in 2022And it only decreased in the group of high-value products with incomplete infrastructure and legality. As for the secondary market, prices and transactions maintain a sideways trend.
According to Mr. Le Hoang Chau – Chairman of Ho Chi Minh City Real Estate Association, although real estate has passed the most difficult period, it is not the end of the chain of difficulties. Compared to the beginning of the year, the market has only partially overcome difficulties, meaning there are still many difficulties that need to be resolved in order to fully recover.
Accordingly to Mr. Ngo Quang Phuc – General Director of Phu Dong Group, recommends that if investors accept to hold land, they need to wait another 6-12 months to have liquidity again. If the financial foundation cannot hold out until then, the owner should accept a partial sale.
(Source: VnExpress)
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