The real estate market today is very different from the "freeze" period 10 years ago

In the Landshow program of VTV Money with the theme “Banks "expand room", real estate flourishes?”, Dr. Can Van Luc - BIDV's chief economist revealed that the second "freeze" of the real estate industry originated from the economic recession. The global financial crisis spread to other countries, including Vietnam, i.e. from the financial and banking sectors to real estate.

“The current situation is not like that. The market is now correcting. At that time, the economic growth in the period 2011-2012 was very low, only about 5 - 5.5%. This year we grew 8%. Inflation was also very high at that time, up to 18% in 2011. Inflation this year is about 3.2%. Next year, even if it rises, it will only be a little over 4%”, Mr. Luc compared economic growth and inflation between the two periods.

“Current business strength is also much better than before. At that time, the business was very sluggish. Now, the pre-tax profit of all the companies listed on the stock exchange in the first 9 months of the year still increased at 14-15%, depending on the field. In some difficult industries, profits also increased by 4-5% on average", he continued to argue.

“The market is stronger now than it was 10 years ago. The essence of the situation is not a real estate crisis. It's just that the market is adjusting to be healthier and more sustainable," Mr. Luc concluded. He also pointed out that real estate prices and transactions this year have a downward trend globally, not only in Vietnam.

Dinh Thuy Huong - General Director of Tan Huong Phat Property Company Limited also agrees with Mr. Luc's point of view, that many people are actually just waiting for “Bottom Fishing”

“Now, the residents are still holding a lot of money, but people are considering whether it has reached the bottom or not, is it suitable to spend on real estate, or just keep the money in the bank for a while and purchase real estate later. In my opinion, a lot of people now tend to go to the bank to deposit money,” she said.

It is believed that from the second quarter of 2023, investors will buy more real estate because the price will be lower than now and the bank interest rate may be more comfortable. Ms. Huong pointed out that when many people have the same thoughts, crowds are formed.

“If everyone waits until the second quarter - the third quarter of next year, everyone goes to deposit money, by that time almost all investors will withdraw their money and purchase real estate. At that time, the demand is large, will real estate go up or down?", she asked. Therefore, Ms. Huong said that if investors have available capital and find a satisfactory product, they should not wait. 

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