HCMC Apartment for Sale Market Q2 2021
Market recovery faces the fourth COVID-19 wave headwind
Pending new launch events due to the fresh outbreak
The fourth outbreak in June 2021 has delayed launch events and hedged new project entries. Despite an increase of 55% q-o-q and 58% y-o-y, new official launches  of 6,046 units in 2Q21 was still fewer than earlier plans. New launches mainly came from the next phases of large projects, including Vinhomes Grand Park in District 9 and Pi City in District 12. Grand Marina in District 1 had the top attention among newly launched projects in this quarter. With 243 initial dwelling units in the first phase, it was the first to enter the ultra-luxury segment in HCMC officially.
Internal amenities attracted owner-occupier
Despite the pandemic escalation, market demand in 2Q21 still positively increased by 4,815 sold units, up 25% y-o-y.
Strong sales come from large-scale projects located in suburban districts with full internal facilities attracting mostly owner-occupiers. District 9 and District 12 led the demand with more than 1,677 and 711 take-up units in 2Q21, thanks to the outstanding development quality of integrated township projects in those districts.
Initial entrance of ultra-luxury segment boosted average high-end prices
The high-end market in 2Q21 welcomed the first launch of the ultra-luxury project, driving primary price in the high-end market to grow at USD 4,905 per sqm, up 5.7% q-o-q and 8.3% y-o-y. In the meantime, the average primary price reduced 0.3% y-o-y due to the domination of mid-end projects with lower-than-average prices in the basket. However, the selling price continued to increase on the project base, at around 4-5% y-o-y. The cost escalation of construction material also contributed to this upward trend.
To maintain buyer power, developers offered a new sale strategy and relaxed payment policy. The most highlighted campaign allowed buyers to borrow up to 100% of the house value and free borrowing interest up to 20 months .
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Outlook: New challenges for real estate market
Since the fourth wave of Covid-19 strongly impacted HCMC, it also affected new supply as sale events were postponed due to social restrictions. The increased demand for working from home during the pandemic has begun to shape the future trend for home workspace.
In the context of an uncertain economy, increasing investment toward real estate will cause apartment prices to continuously grow according to market sentiment, thereby potentially pushing up the average market selling price to a new level.
- Prices exclude VAT and sinking fund/maintenance fee.
- Official launch: Projects are considered as officially launched when the Sale Purchase Agreements are signed, typically upon foundation completion.
- The loan approved by owner’s collateral and other conditions.
Source: JLL Research