Price has started increasing: Buy or Wait?

Shortly after the New Year festival, the Watermark project (Lac Long Quan Street, Tay Ho) had launched a series of programs for customers buying apartments. Accordingly, customers only need to pay 30% for the first payment, and 5% in the next month to receive apartment in the quarter II/2015.

(According to VietNamNet) After the New Year festival, many real estate enterprises had launched their new sales campaigns with a series of promotions to take advantages of the recovering market. Meanwhile, more transactions have been done in the market, because of increasing buyer demands, as well as investor demands due to their expectation of a warmer market.

Mega Promotions

Shortly after the New Year festival, the Watermark project (Lac Long Quan Street, Tay Ho) had launched a series of programs for customers buying apartments. Accordingly, customers only need to pay 30% for the first payment, and 5% in the next month to receive apartment in the quarter II/2015.

As per Watermark’s announcement, in the end of 2014 – beginning of 2015, this project had pretty good sales with the remaining apartments are less than 30, and those with Westlake Views prices increased up to billions VND per unit.

According to experts, nowadays sales promotions are key factors that affect customers’ decision, besides prestigious investors and project quality assurance programs.

One notable project is Hoa Binh Green City, which is well known with gold-plated details in the apartments. Its H1 building was sold out within only 2 years after civil work completed. Confident with this fact, investors strongly believed that H2 building price would be adjusted increasingly in every sale opens because of the H1’s success beyond expectations.

Nevertheless, in order to attract customers, Hoa Binh had to use many promotional tactics, of which is the offer “free SH motorbike and Furniture package for all customers until 10/4”.

Many others real estate investors even more drastically launched their promotion programs. Park 3 – Residential Condominium Project in Times City – Park Hill, distributed by Đất Xanh Miền Bắc, is offering a cash discount at 7% per year on the total deposit payment, plus an interesting service package. Also, the bank offers bank loan up to 70% of total contract value, at 0% interest for 10 months.

Goldmark City Project‘s investor offers a 3% discount on contract value, along with bank loan at 0% interest for the first 12 months. The 20 first customers buying The one Residence Condominium will receive special promotion and lucky gifts worth up to 200 million VND.

Buy now or continue waiting?

In fact, since the real estate market corrupted from late 2011 until now, the psychology “buy or wait” has more or less appeared with most of the people who want to buy houses to live or to invest. Generally market since then still remained downward trend.

For instance, in 2014, research agencies announced an approximate 30-40% reduction of real estate price compared to its peak. And therefore, if compared to the price at the end of 2011, those who “patiently” waited may have been slightly benefited thanks to the decline of the market price.

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Some projects such as Kim Van – Kim Lu, H3 – H4 Linh Dam, Park City, The Spark also were increased selling prices from 2-5% for sales opened before and after Tet Holiday. However, since late 2014 to present, along with the warming market, real estate prices in some projects have begun being increased slightly. On the secondary market, if someone wants to own an apartment with good location, good direction, and right area must spend from 50 – 200 million VND commission for previous buyers.

Mr. Pham Thanh Hung, deputy general director of Cengroup, said the wait-and-see psychology is reasonable. Of course, it is not true with all projects. Remote location projects, the prices keep declining steadily. On the contrary, projects with construction progress as schedule, and prime locations, which they are selling, the price is rising every week. Customers even have to come at 5am to register for buying apartment.

Therefore, according to this expert, the key points are each family, each person’s demand and capability. If a person highly demands a place to live, then buying a house with an acceptable price can considered a big success of the year. And for those who do not need new shelters in hurry, or buy to invest, then depending their calculation and financial capabilities, can put money into real estate, but carefully consider projects with high liquidity and profitability.

However, over cautious minds, who continue to hug money and wait, may have to think again. Due to the fact that every macroeconomic element is getting better, and will stimulate the warming of the real estate market. And the upward changes in prices of the market in Hanoi, Ho. Ho Chi Minh City as well as the increasing number of sales over each quarter of the entire market should be regarded as an important reference.