|A view of Phu Quoc Island. The transparency of the real estate market needs to be improved to ensure stable development.(Source:cafeland.vn)
In 2018, the property market saw ‘price fever’ in several localities, especially those with potential for tourism growth and those expected to be developed into special administrative economic units like Van Don in Quang Ninh province and Phu Quoc in Kien Giang province, where buyers grabbed property with hopes for significant returns.
When the National Assembly voted to delay the passing of the Law on Special Administrative and Economic Units –and when local authorities ordered a halt to land transitions – the price hikes in Van Don and Phu Quoc cooled off.
Nguyen Van Dinh, deputy president of the Vietnam Association of Real Estate brokers, said this was a necessary “pause” for the real estate markets in these two hot areas to return to stability.
Dinh added that market transparency there also needed to be enhanced to reach their development potential.
According to Nguyen Manh Ha, deputy president of the Vietnam Real Estate Association, the inflated prices occurred mainly due to speculation which pushed prices far above their real values, adding that ‘price fevers’ brought a lot of risks for both the market and investors.
One way to prevent such wild speculation is to make real estate project information public and increase the transparency of the planning stage. Brokerage management should also be strengthened.
Economic expert Vu Dinh Anh said developing a real estate information system was an important step towards improving market transparency.
The Government issued a decree in 2015 about the development, management and use of a housing and real estate market information system. However, Anh said implementation remained slow.
He said Vietnam needed to develop a system to provide accurate information and regular updates about land planning and the status of the property projects.
Anh said ensuring the balance between supply and demand in the real estate market and developing the information system would help the property market develop more stably and sustainably.
In a report to National Assembly delegates in October, the Ministry of Construction admitted that the development of the real estate market still lacked transparency in planning, selecting developers and transactions.
Deputy Minister of Construction Nguyen Van Sinh said the ministry would study policies to prevent real estate speculation, stabilise the market and efficiently manage land resources.