Low-end apartments disappear on developers’ lust for profits: study

By Dat Nguyen   March 24, 2021 | 03:00 am PT
Low-end apartments disappear on developers’ lust for profits: study
Apartment buildings seen in District 2, Ho Chi Minh City. Photo by VnExpress/Quynh Tran.
Apartments at the lower end of the price spectrum, costing less than VND2 billion ($86,700), are disappearing from the market despite high demand.

In Hanoi and HCMC, last year there were no major projects with 1,000 units or more in this segment, according to market research company Vietnam Report.

High-priced segments, however, saw increases in both numbers and prices, with prices doubling in some cases to VND300 million per square meter, it said.

Demand for low-priced housing would remain high this year, but developers are not interested in the segment due to low profit margins, it said.

It said the government needs to push developers and banks into investing more in this segment, which is in dire need of funding.

The housing market had a difficult year last year due to the impacts of Covid-19, with sales falling by half year-on-year in the second half to 74,500 units.

Factors that could improve the market this year include the resolution of legal issues related to licensing, containment of the pandemic and an increase in foreign direct investment, the report added.

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