Land prices in Nghe An are soaring following news of commune mergers.
The real estate market in many localities of Nghe An province is witnessing a phenomenon of rising land prices. Notably, this "fever" does not stem from economic factors or infrastructure development, but mainly from information about the merger of administrative units.
The implementation of the policy to reorganize and merge commune-level and district-level administrative units in Nghe An has created many expectations regarding the potential for socio-economic development, and this information has driven up land prices in many areas quite significantly.
In Yen Thanh district, several online land sales websites are bustling with attractive offers. One land broker advertised: "I have a few plots in Bao Thanh commune, priced at 1.5 billion VND. If the area is merged, you might not even be able to buy one for 2 billion VND. Only those who act quickly will have a chance..."
Many brokers continuously spread rumors about the potential for skyrocketing land prices after the merger, fueling a "buy now before it's too late" mentality among many investors, especially those lacking experience. However, according to surveys, transaction volumes only increased in certain areas rumored to be the administrative centers after the merger.
In Bao Thanh commune, considered the new administrative center of the cluster of five communes including Long Thanh, Vien Thanh, Vinh Thanh, Son Thanh, and Bao Thanh, land prices have increased significantly. Ms. Le Thi Tam, an investor in Yen Thanh town, said: “Plots of land along the provincial road in Bao Thanh used to cost only about 1.4 billion VND, but now they are 1.5 - 1.6 billion VND. Plots along National Highway 7 have increased by about 200 million VND per plot, reaching 3.5 - 3.8 billion VND.”
Mr. Nguyen Huu Chung, Chairman of the Bao Thanh Commune People's Committee, stated: "Most of the information circulating is being exploited by speculators to inflate prices. In reality, the commune's infrastructure has not undergone any significant changes. Investors should be cautious and carefully consider before investing."
A similar situation is unfolding in Bac Thanh commune, where rumors are circulating that Xuan Thanh, Nam Thanh, and Trung Thanh communes will be merged. Land plots along National Highway 7B have increased by 150-200 million VND per plot in a short period; however, many investors are still rushing to "stockpile" land, waiting for prices to rise even higher before selling.
In Dien Chau, news of the merger of Dien Kim, Dien Hoang, and Dien Hung communes into Dien Hai commune has caused land prices in Dien Hai to rise sharply. Ms. Tran Thi Minh, residing in Dien Ky commune, said: "At the beginning of April, the price of land plots on the main road of Dien Hai commune was about 2.5 billion VND/plot, but now it has increased to 3 billion VND."
In Nghia Dan district, particularly in Nghia Son and Nghia Lam communes, land prices, which were previously stagnant, are now showing an upward trend. For example, land plots in Nghia Lam commune have increased from 2.2 billion VND to 2.5 billion VND per plot in just a few weeks.
However, according to our research, not all areas have seen price increases. For example, urban development projects in Ngoc Bich commune, Dien Chau district, still maintain prices at 18-20 million VND/m².2In some communes not included in the merger area, land prices have not increased, and transactions have even become difficult.
The essence of sustainable real estate value lies in its connection to a comprehensive development foundation in infrastructure, economy, and society. Land price surges based on unverified information or lacking proper planning and investment are often short-lived, rising rapidly only to stagnate or decline.
Lessons from previous real estate booms show that those who buy at peak prices often fail to exit when the market declines, resulting in long-term capital immobilization or forced losses due to low liquidity. Therefore, caution is needed before the current wave of investment.
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According to Mr. Chu Duy Phong, Head of the Finance and Planning Department of Dien Chau District, the real estate market in the district is currently quite vibrant, attracting the attention of many investors.
However, he also cautioned that, during this period, investors need to be especially wary of unclear or unverified information. Rushing to invest based solely on rumors could lead investors to "buy at the peak," facing significant financial risks.
