Real estate firms eye record profits this year

Novaland, the second biggest listed property firm, targets a near doubling of profits to VND6.5 trillion ($285 million) and a 140-percent rise in revenues to VND35.97 trillion.

The company’s projection of these all-time high figures are based on revenues it expects from the handover of houses and other properties at 22 projects in HCMC, Dong Nai, Binh Thuan and Ba Ria - Vung Tau this year.

Phat Dat, another real estate firm in the billion-dollar club, expects revenues to triple to VND10.7 trillion and profits to rise by 56 percent to VND3.6 trillion.

Many other companies in the sector also expect profits to rise sharply this year as demand is driven up by post-Covid recovery and risk of inflation. For Vietnamese, real estate is a safe haven investment during times of inflation.

But others warned about possible headwinds.

Nguyen Mac Hoai Nam, general director of investment consultancy Nam Phat, agreed that such goals are achievable but warned about demand drying up due to rising prices. So developers need to sell their projects quickly to optimize profits, he said.

Tran Khanh Quang, head of developer Viet An Hoa, expected the market to remain busy until the second quarter but warned it could turn sluggish quickly after that.

This would split the industry into two, with one group of companies still attracting buyers and achieving its business plans and the other seeing sales stall, he said.

He expected around 30 percent to fall in the second group.

An insider with nearly 30 years of experience in the industry said selling out quickly and profiting is the general trend in the market now.

"As soon as the pandemic passed, real estate companies accelerated things to regain what they had lost in the last two years. This year will be a turning point, a test for the market".