Apartment selling prices tend to increase

Apartment selling prices tend to increase

As the long-sluggish property market has started showing signs of recovery this year, certain housing developers have hinted at price hikes in an apparent attempt to attract buyers who fear a price rise.

According to The Saigon Times Daily, Hoa Binh Co., Ltd, the investor of the Hoa Binh Green City project in Hanoi’s Hai Ba Trung district, is planning to increase apartment prices this month.

Nguyen Huu Duong, General Director of Hoa Binh, said the price hike may be around 10%. The company is quoting the price at 20.5 million VND per square meter for unfurnished units and 26 million VND for furnished units, VAT excluded. With such prices, Hoa Binh earns almost no profit due to higher investment cost and interest rate, Duong noted.

Hoa Binh Green City has 560 apartment units, with over one-fourth of them already finding buyers. The property market in Hanoi late last year was taken by surprise when the project’s investor announced the apartment building’s balcony rails, elevators and lobby were all gold-plated.

Early this year, Viglacera launched a sale of apartments in the Thang Long Number One project, which attracted attention of many customers as it is located near the city center. Then there was a rumor that the price of Thang Long Number One apartments could rise.

According to a report on apartment prices recently released by the Hanoi Department of Construction, the housing price fall has shown signs of easing since the final quarter of last year and some projects, especially high-end ones, have reported price rises of 1-3%.

Nguyen Quoc Khanh, Chairman of G5 property exchange, said some investors had raised apartment prices by 3-5%.

Some high-end projects at prime locations and those soon to be handed over to buyers have proven attractive to customers but supply is limited.

Investors and speculators have taken advantage of this to push up selling prices.

The price of Mandarin Garden apartments invested by Hoa Phat Group, for instance, has been increased by investors who can enjoy a profit margin of 300-500 million VND per unit. Similarly, Vinaconex 7′s project at 136 Ho Tung Mau Street in Tu Liem district has also seen prices surging 1-2 million VND per square meter from the original price.

According to Dieu Lanh at Thang Long property exchange, since early this year, a lot of customers have called to ask for information, leading investors to raise prices.

Explaining the price hike at Hoa Binh Green City apartment project, Duong said the announcement is aimed at prompting customers to quickly make decisions.

“The apartment segment is improving with many successful transactions reported by projects at good locations or with good progress. Therefore, price adjustments are unavoidable,” he said.

However, some have cast doubt over what might be apartment developers’ trick to lure customers as the property market is still in distress and transactions have improved at some projects with affordable prices and small apartment sizes.-VNA

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