Nghe An Real Estate Market: Some places are quiet, some transactions are cautious

The auction land market is quiet.

Land fund exploitation auction is only one of the channels, the supply of land products divided into lots to the market. If calculated roughly in Vinh city and the delta districts, on average each year about several thousand land lots are planned for exploitation.

Compared to many other segments, the above products are not much, but because this is the price set by the state, it has affected the market. In recent years, whenever dividing and selling land, people naturally take the price of the State auctioned land near their house as reference and sell.

Investors research at a land auction site in Yen Thanh district. Photo: Van Truong

In Vinh City, in the first quarter, the city planned to build 70 lots and currently put 33 lots up for sale, but after 3 announcements, only 3 lots were sold, including 2 lots in Xuan Dong hamlet (Nghi Duc) and 1 lot in hamlet 21 Nghi Phu, the total amount was 17.58 billion VND, 5% higher than the starting price plus the step price. Hoang Mai town put 1 lot in Quynh Xuan up for auction, but due to the price in 2022, no one bought it. Yen Thanh district, which used to be the center of land auctions when at one point the auction price doubled the starting price, but in the recent auction in Tang Thanh, the district sold 14 lots but did not sell any documents.

The road project along the Quan Hanh town center hopes to create a boost for the Nghi Loc real estate market, but at this time, due to the influence of the market, it is still quiet. Photo: NH

Similarly, in localities such as Thai Hoa, Yen Thanh, Nghi Loc, Quynh Luu... according to the land exploitation plan, since mid-February, some areas have been put up for sale, but due to lack of buyers, the districts have not yet planned to auction in March because at this time, if sold, it will be difficult to find buyers for the documents and auction.

According to the Property Auction Service Center: The plots of land that were put up for auction in the past had no buyers, partly because the location was not good, and now they are put up for sale when the market has hit rock bottom, so there are even fewer buyers. A typical example is the plot of land in Hamlet 21 Nghi Phu, the unit had to announce 10 times before there was a buyer, and currently the plots of land in Hamlet Xuan Dong (Nghi Duc) have been announced many times but have not been sold out.

Infrastructure construction of resettlement area with land fund auction in hamlet 21, Nghi Phu commune (Vinh city). This land has quite nice infrastructure but there is still 1 lot left after 10 announcements to be sold. Photo: Nguyen Hai

We learned that, in addition to the new land lots that localities are building infrastructure to auction, there are still a large number of land lots on the market that speculators bought last year at high prices, which have not been sold yet and have not been reduced in price to cut losses.

Here is a story from a land trading floor owner in Quynh Luu: in 2022, Nghia Dan and Thai Hoa areas are new markets and land prices are cheap, so they bought 1,500m²To change the purpose, divide into 7 smaller lots for sale. After the subdivision is completed, it can be sold for 300 million/lot/200m², profit about 50 million/lot. At that time, because I thought the price would continue to increase, I did not sell, but unexpectedly the price turned around and decreased, the price was only 250 million/lot, but now no one is buying.

People wait to complete land transfer procedures at the One-Stop Department of Nghi Loc district. Photo: NH

Representatives of the Land Use Registration Office in Nghi Loc District and Vinh City confirmed: Since the beginning of the year, the transactions have mainly been for loans or parents to separate plots of land for their children. Specifically, Nghi Loc used to receive about 300 applications per day, but now it only receives 100 applications, Vinh City used to receive about 250 applications, but now it only receives 65-70 applications, the number of transfer and name change applications has decreased significantly.

With the early planning to become a town and the mechanism to exploit land fund for infrastructure investment, Do Luong district is a bright spot in land auction transactions. Photo: Contributor

In the gloomy picture above, the most positive signal belongs to Do Luong, although the auction price is not high, there are still transactions.

Specifically, by the end of the first quarter, the district sold 61/84 plots of land, of which Thinh Son sold 7/8 plots; Thuong Son commune sold 9/15 plots; Quang Son commune sold 9/16 plots; Nam Son commune sold 9/16 plots; Boi Son sold 14/16 plots; Lac Son sold 13/13 plots.

The representative of Nghe An Property Auction Service Center analyzed: The reason why Do Luong was successfully sold is because this area is enjoying 100% of land use fees, so it is promoting land exploitation to get resources to invest in infrastructure for the future town. Recently, some areas have auctioned quite good land, so there are buyers.

Waiting and "bottom fishing" mentality

Since the beginning of the year, the land auctions have had few buyers, affecting the market. In fact, the number of transactions through auctions has also decreased significantly compared to before. In addition, localities are also reluctant to hold auctions at this time because the results will not be favorable. A leader of the district-level Department of Finance and Planning shared: Because the reference price for price construction from 2022 is when land prices are at their peak and after 6 months, the auction is held again when the market is at its quietest, leading to inadequacies and difficulty in success.

Land auction infrastructure in Trang Son commune, Do Luong district. Photo: Nguyen Hai

Due to difficulties and budget collection pressure, localities have considered adjusting the price down, but the process and procedures are quite complicated. For example, among the 20 lots put up for auction in 2022, if after 3 announcements the price is still not sold, a new price can be established, but if only 1 lot out of 20 is sold, it is very difficult to reduce the price. Therefore, many land plots in Vinh City cannot be sold and each time there is an announcement and auction, only 1 lot is successful, so it has to be auctioned many times and cannot be adjusted down.

Mr. Nguyen The Anh, representative of a land trading floor in Nghi Phu (Vinh City) said: Since the beginning of the year, he has introduced dozens of products, including urban area products, products consigned by people who want to sell and products purchased from auctions. However, due to the high prices, most customers only ask to survey the market.

At this time, investors are waiting to buy at the bottom, if anyone is willing and needs to buy, they can negotiate to reduce. For example, recently, the floor has just introduced a plot of land in Nghi Phu, in 2022 the owner advertised for sale for about 2.7 billion VND but now it is only reduced to 2.4 billion VND and if the customer is willing and really needs to buy, they will negotiate again and the price can be reduced by another 20-50 million VND.

Infrastructure of the land auction area in Quynh Luong (Quynh Luu), due to its location near the sea, during the fever period, many people participated in the auction and looked to buy, but now the prices have dropped sharply, there are still some unsold lots but the locality has not put them up for sale. Photo: Nguyen Hai

Due to the lack of buyers in many land auctions, some localities have accelerated the survey to set new starting prices based on the situation. Specifically, the Vinh City People's Committee has issued a document directing communes, wards and departments to review and synthesize data to rebuild the price steps for 68 land lots built in 2022.

Meanwhile, in Nghia Dan, after preparation, the district signed a contract to sell 40 plots of land in Tan Hong block, Nghia Dan town with a starting price of 580-690 million VND/plot, a decrease compared to before. Representatives of the Finance - Planning Department hope that the auction results will create a premise to "warm up" the market and attract investors to return.