Sidewalk demand campaign: Street-front houses lose value, alley houses become more popular

The campaign to demand sidewalks for pedestrians is boiling in Ho Chi Minh City, causing street-front houses to lose value, while alley houses to increase in value.

The campaign to reclaim sidewalks for pedestrians is still raging in Ho Chi Minh City. People are very happy to see the city more open and cleaner. However, the owners of street-front houses have the opposite feeling as the prices of street-front houses have dropped significantly.

Street-front houses lose value

Recently, business households in districts of Ho Chi Minh City have been worried when receiving notices that they must stop encroaching on sidewalks for business purposes.

The campaign to reclaim sidewalks for pedestrians has made the street-front housing segment gloomy.

Ms. Nguyen Thi Thu Hoai (office lunch shop manager) at 132 Nguyen Dinh Chieu Street, Da Kao Ward, District 1, complained that she was informed that if she did not voluntarily dismantle and destroy the steps, the ward would conduct a forced inspection and demolish them. The shop would have to pay all costs.

"Those of us who are in business know that if there is no parking space for customers, how can customers enter the restaurant? It is impossible to do business. Since yesterday, my restaurant has been deserted, with only a few customers coming in and out. Meanwhile, I have to pay tens of millions of dong to rent the space... I don't know how my restaurant will do in the future," Ms. Hoai "complained".

A series of cafes and food service establishments are also in a “half-crying, half-laughing” situation because they do not know where to find parking for customers. Stores are deserted because customers do not have parking spaces, so street-front houses suddenly lose value.

According to Ms. Ha, a broker with dozens of townhouses in District 10, at the end of 2016, streets such as Le Hong Phong, Nguyen Trai, Tran Hung Dao, District 10, etc. were still crowded with business customers looking to rent for business purposes. However, since February 2017, when the campaign to reclaim sidewalks for pedestrians started to heat up, the street-front house segment has become gloomy.

According to Ms. Ha, at this time, there are more people looking for prices than renting or buying. Usually, townhouses in the center are narrow, with only a few motorbikes parked. Parking lots in the center are overloaded, so the advantage of a townhouse now becomes a disadvantage.

Many companies and businesses also ignore street-front houses. Ms. Ha revealed that she had taken a few contacts to see houses for rent, but after viewing, they shook their heads and left, even though the rent had decreased by nearly 10% compared to last year.

Along the streets of districts 1, 5, 10 and 11, billboards have now given way to banners with the message “shop for rent”. There are stretches of road only 100 meters long with up to 3 street-front houses hanging “for rent” signs.

Although the landlord committed not to increase the price compared to last year, Mr. Tuan (42 years old, from Binh Dinh) and his wife are planning to transfer the premises of their pho shop on Tran Quoc Thao Street, District 3.

The house in the alley suddenly has a fever.

During this time, many shop owners on major streets in the city center have returned their premises and found premises in alleys with lower prices.

With many advantages, houses in alleys are chosen by many business households. They not only enjoy cheap prices, but also have the opportunity to hang advertising signs of any size. From there, there are conditions to compete on price, buyers can get discounts, cheaper services without worrying about parking.

According to the survey, houses in alleys with prime locations near the street, spacious, near residential areas... are increasing in price from 5 - 10%. In addition to dining areas, clothing shops, coffee shops... operating in dead-end style are quite crowded. Clothing shops in alleys on Quang Trung Street, Go Vap District are almost always crowded with customers coming to buy goods every day.

Houses in alleys are chosen by many businesses.

According to the owner of the above shop, the rent here is only 7 million VND/month, much cheaper than many street-front houses. Moreover, the shops in the alley also develop by combining online business with websites, social networks, etc. to find customers. The shop owner said that renting a house in an alley is more profitable than a street-front house.

Economist Le Ba Chi Nhan said that the recent move by authorities to restore order to sidewalks has caused the rental price of townhouses to drop because the townhouse segment depends up to 80% on the sidewalk space in front of the store.

The more open the sidewalk, the higher the rental price will be.

However, according to Mr. Nhan, when this is disrupted, business is affected, and tenants are naturally hesitant. But this is only for a short time, because after stabilizing the sidewalk order, the competent authorities will consider rearranging the sidewalk and parking lot.

Many shop owners say that renting a house in an alley is more profitable than renting a house on the street.

Along with that, according to Mr. Nhan, houses in alleys in good locations will be popular in the near future. The reason is that the rent is much cheaper than houses on the street, and there is also a spacious and comfortable parking space; you can put or hang advertising signs or do business.

Mr. Nhan believes that this is the trend of small and medium-sized service businesses. Besides, many large businesses or food and beverage establishments are also looking for these locations./.

According to VOV