90% of condotel projects record no sale in Q1

Although 4,800 new units were launched, only 64, or 1%, were sold, said a new report by the group.

Most of the new units came from existing projects in central and southern Vietnam: Quang Nam, Binh Dinh, Khanh Hoa, Binh Thuan and Ba Ria-Vung Tau.

Another report by the Vietnam Association of Realtors showed that in the first quarter 10,000 units were launched but only 1.6% of them were sold.

Prices, however, remained at average high levels of VND180 million per square meter in the central and VND155 million in the south.

Mauro Gasparotti, director of property consultancy Savills Hotels Asia-Pacific, said that condotel demand surged in the 2016-2019 period when 12,000 new units were launched annually.

However, developers mostly focused on selling their products without caring about customer experience, he said, arguing that this is why sales are now low, especially on Phu Quoc Island in the south.

Condotel projects in Vietnam are built with low quality and lack of creativity in design, he added.

Tran Trong Vu, co-founder of SPE.R, a market researcher in the central region, said that condotel operators gained only 2.7% in profits on average, and hardly anyone reached 5%.

This is why many investors have turned their back to condotels, he added.

Industry insiders say that the low demand for condotels is set to linger for the rest of the year.