Nghe An: Land transactions remain active despite no price drop.
(Baonghean) - While real estate exchanges have had to close or cease operations due to the impact of Covid-19, land transactions among the people remain vibrant despite prices not falling.
The stock market is quiet, but transactions among individual buyers are active.
A survey of trading floors in Vinh City revealed that most are closed and have ceased trading. A representative from a large trading floor in Vinh City stated: Compared to last year and the first two months of this year, the impact of the Covid-19 pandemic has significantly reduced trading since March. The floor remains operational but mainly provides online consultations to customers, with only a few transactions completed each month.
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| An apartment building on the extended Le Mao street in Vinh Tan ward still has apartments for sale, but prices haven't decreased. Photo: VH |
Upon investigating at a trading floor on Mai Hac De Street, we found that although the floor was newly established and had a relatively good number of transactions, there were only a few transactions per week, perhaps one on a busy day. According to the floor's representative, most transactions were signed before the pandemic, and since the outbreak and especially the social distancing order, transactions have decreased significantly.
According to a representative of a large real estate agency on Tran Phu Street, the reason for the sluggish transactions is that all agencies are closed in compliance with Directive 16. Furthermore, since the beginning of 2020, real estate businesses have not launched any new products.
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| Residents of Vinh City complete real estate transfer procedures at the one-stop service center of the City People's Committee. Photo: Nguyen Hai |
The situation is similar for land plots near the resettlement areas along the 72m and 35m roads in Nghi Duc, Nghi Phu, and Quan Bau communes, with prices ranging from 9.5 to 12 million VND/m².2Mr. Nam, a land buyer in Le Mao ward, said: "I have a need to buy land, so since the beginning of the year I have gone to the surrounding communes many times to look for land, but generally the prices are quite high. In other districts and towns, the situation is similar; although land auctions are postponed, there are still many land transactions on social media."
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| The land plots in Hamlet 5, Nghi Phu Commune, with dozens of lots put up for auction, will generate revenue for the Vinh City budget. Photo: Van Hai |
Mr. Le Quoc Tuan, Director of the Land Use Rights Registration Office of Vinh City, said: "From March until now, despite the pandemic, land transactions have not decreased, with about 30-45 land transfer contracts signed each day."
Abundant supply
In discussions with us, real estate experts stated that although land transactions are still taking place, the current market conditions are unfavorable. Transactions, supply, and demand remain, but the general trend is to wait for price reductions. In fact, land prices in Quynh Luu district and Hoang Mai town have already seen a slight downward adjustment.
Specifically, land plots along Provincial Road 537 and National Highway 48B, which sold for 220-250 million VND/m² along the road at the end of 2019, have now dropped to around 190-200 million VND/m². In Hoang Mai town this year, the People's Committee plans to auction off hundreds of land plots, creating a great opportunity for residents and investors.
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| Newly built apartments in a mixed-use development area in Quynh Hong commune, Quynh Luu district. Photo: Van Hai. |
Currently, not only in Nghe An but also in other countries, land transactions are sluggish. The current situation is not suitable for short-term speculative investment but presents an opportunity for medium-term investment. Mr. Nguyen Van Tu, Director of the Land Fund Development Center of Vinh City, said that due to rising land prices and pressure to generate revenue for the budget, the supply of land to the market in 2020 was quite abundant compared to previous years.
Currently, the apartment segment and new projects in the center of Vinh City have little chance of price increases. However, this year, the supply of land plots for projects and resettlement in suburban communes is quite abundant, and profitable locations have high potential. For now, due to the impact of Covid-19, land auctions are postponed but will resume. Hopefully, along with the economic stimulus packages and policies on exemption, reduction, and deferment of land rent to support businesses recently introduced by the Government, businesses will overcome difficulties and real estate transactions can become more vibrant.
In another development, although the State Bank of Vietnam has tightened regulations on lending and real estate purchases in overheated markets to curb speculative transactions, in Nghe An province, due to the normal state of the real estate market and transactions, banks are still providing loans as per regulations - according to a representative of a commercial bank branch in Vinh City.
