Nghe An: Many localities auction land without buyers

Land auction but few people participate

In Nghi Loc district, after a period of "feverish" land prices,real estate markethas cooled down, there is a situation of transactions being "abandoned". Currently, many communes organize land auctions but very few people participate in the auction.

Mr. Pham Ngoc Duyen - Chairman of Nghi Xuan Commune People's Committee, Nghi Loc District said: From October 2022 to now, the commune has organized an auction of 10 land lots, however, after 3 auctions, only 1 land lot has been sold, the lowest price is 6.5 million VND/m2²Previously, the commune organized an auction of 36 plots of land, but only 31 plots paid, the remaining 5 plots waived their deposits.

A representative of the Department of Natural Resources and Environment of Nghi Loc district added: Since the beginning of 2022, Nghi Loc district has had 36 plots of land "abandoned". After 90 days, the People's Committee of Nghi Loc district has issued a decision to cancel the land auction results and collect the deposit of customers participating in the land use rights auction to the State budget.

It is known that the land auction at the beginning of the year in Nghi Loc district was very "hot", the number of participants was large, the auctioned land increased. However, there were quite a few households and individuals who were recognized as winning the land use rights auction but did not pay, or did not pay enough money within the prescribed time.

The reason many land auctions have few participants and many investors abandon their deposits is because the real estate market has cooled down, bank interest rates have increased, and real estate business is currently unstable.

Faced with the sluggish real estate market, recently, Nghi Loc district has not organized large-scale auctions as before, approving 1/500 details to survey and select locations to build infrastructure for land auctions in suitable areas, limiting the situation of abandoned deposits.

Infrastructure in Do Luong district has been invested synchronously, but it is very difficult to make transactions at this time. Photo: Hai An

Also in the above situation, Do Luong district currently has many land lots that are being abandoned and must be re-auctioned. For example, on March 24, 2022, Luu Son commune, Do Luong organized an auction of land in the Trot Bong infrastructure area, the land lot with the lowest price was sold for 2.048 billion VND, the highest lot was up to 6.1 billion VND, however, after the regulation of 90 days to pay the full land price, 28/59 lots were abandoned.

Mr. Nguyen Quoc Giap - Chairman of the People's Committee of Luu Son Commune said: The People's Committee of Do Luong District has issued a Decision to cancel the land auction results and pay to the State budget over 12 billion VND in deposits for 28 land lots. According to the plan in early March 2023, the commune will organize an auction of 28 deposited lots, accordingly, the commune will rebuild the land price in accordance with the market, because the commune previously built a high auction price because of the land fever at that time.

Mr. Tran Doan Phu - Head of the Justice Department of Do Luong district said: From the beginning of 2022 until now, Do Luong district has had over 100 plots of land "abandoned deposits" such as Bac Son commune abandoned 12/19 plots of land, Do Luong town abandoned 9/17 plots of land... To resolve the "abandoned deposits" of land, Do Luong district is continuing to re-organize land auctions in some localities. Recently, in November 2022, Thai Son and Tan Son communes successfully auctioned 24/26 plots of land. However, we have to wait 90 days to know whether the buyer abandoned the deposit or not.

Currently, there are many other districts that are also in the auction situation but few people participate, concentrated in Dien Chau, Quynh Luu, Nghia Dan districts...

Freeze transactions

Real estate liquidity declinesand freezing transactions is a common situation recently recorded in Nghe An. In many districts where land prices used to be feverish, the market is now falling into a slump with the majority of land and apartments.

The infrastructure of Dien Phuc commune (Dien Chau) has been invested in quite well but few customers are interested. Photo: Hai An

Mr. Tran Cao in Dien Ngoc commune (Dien Chau) said that when the land price was hot, he spent more than 2.4 billion VND to invest in a plot of land in Dien Phuc commune along National Highway 7. Because this is near the intersection between National Highway 7 and the North-South Expressway, it has the advantage of opening a restaurant business. However, up to this point, he has "lowered" 100 million VND to cut a loss and sell it for 2.3 billion VND, but no one has asked to buy it.

In Yen Thanh district, many real estate brokerage offices have had to temporarily stop operating because the land market has been "frozen" for many months. The land lots posted for sale by investors have not received much attention. Currently, many investors in Nghe An want to "cut losses" but there are almost no real estate transactions, making those who "hold land" restless, especially those who borrowed a large amount of money from the bank to invest in buying land during the high land fever.

An infrastructure area of ​​Yen Thanh district has many plots of land with abandoned deposits. Photo: Hai An

According to the report of Nghe An Tax Department, from the beginning of 2022 to now, Nghe An has collected over 6,900 billion VND from land use fees (project land and land use rights auction exploitation), 1,400 billion VND higher than the same period in 2021. However, this is the revenue mostly in the first 4 months of the year. The functional sector has collected over 50 billion VND (from over 200 abandoned land lots) and paid into the State budget according to regulations. The number of abandoned land lots is concentrated in Dien Chau, Yen Thanh, Hung Nguyen, Quynh Luu districts...

According to some experts, after the State Bank increased input interest rates, commercial banks also continuously increased deposit interest rates, so the cash flow is tending to flow into the banking channel instead of investing in other channels. When the stock and real estate markets show signs of slowing down, the tendency of the majority of people is to save money, so it is predicted that in the short term, real estate prices are unlikely to increase.

Project land in Dien Chau district is still being traded due to reasonable prices and synchronous infrastructure investment. Photo: Hai An

Mr. Nguyen The Phiet - Head of Housing and Real Estate Market Management Department, Nghe An Department of Construction added: Unlike rural land, currently, project land in the province still has transactions, because the infrastructure is invested synchronously, the price is reasonable, the investor regulates to liquidate the product. While many people buy rural land at too high a price, now reselling it, although it has decreased, is still high so the liquidity is low.