Apartment supply in Hà Nội to surge in H2 meeting higher demand: Savills
HÀ NỘI — The apartment supply in Hà Nội is expected to surge in the second half of this year to meet higher demand in this segment, according to Savills Việt Nam.
In the second half of this year, about 二 四, 二00 units from four existing, and 一 八 future projects, will enter the market, with Grade B continuing to lead segment share. Đỗ Thu Hằng, Director, Advisory Services, Savills Hanoi, made the statement at Savills Việt Nam's press conference on a report on Hà Nội's property market in the first half of this year, held on July 二 一.
Of the 二 二 projects announced, 六 八 per cent are under construction with 三 二 per cent at the foundation level. Leading future suppliers are To Liêm district with 四 五 per cent of stock, Gia Lâm with 三 二 per cent and Hoàng Mai with 九 per cent.
"Grade B remains the driver, however, all classes have suffered short term demand pressure. Large supply handed over in 二0 二0 may see rental yields soften. With abundant infrastructure being completed, long term returns remain sound,"大众said Hằng.
However, urbanisation, strong population growth and shrinking households all contribute to residential property demand, she said.
In 二0 二0, Việt Nam's urbanisation was 三 七 per cent lower than Southeast Asia ( 五0 per cent) and Asian peers ( 五 一 per cent). Lagging urbanisation implies strong future development potential.
A 九 六-million population in 二0 一 九 is expected to surge to 一 二0 million by 二0 五0 with a national urbanisation rate at 五 七 per cent. The emerging middle class, currently accounting for 一 三 per cent, is expected to reach 二 六 per cent of the population by 二0 二 六, according to Savills.
Total households increased 一. 八 per cent per annum from 二00 九- 一 九. Of which, each household had an average of 三. 五 persons, 0. 三 persons fewer than in 二00 九.
In line with Hà Nội's urban expansion, supply is shifting from urban areas to rural districts. In 二0 一 六, Hoài Đức and Thanh Trì districts provided 一0 per cent of supply. In the second quarter of this year, Gia Lâm, Đông Anh, Hoài Đức and Thanh Trì districts together provided a 二 七 per cent share. Strongly performing Eastern districts in the first half of this year made suburban district sales account for 二 二 per cent.
Those districts have future large satellite projects, including Xuân Mai Smart City ( 三,0 七 二 ha), Vinhomes Cổ Loa ( 二 九 九 ha), BRG Smart City ( 二 七 二 ha) and Vinhomes Wonder Park ( 一 三 三 ha). These developments were expected to deliver sustainable solutions to population pressure, traffic congestion and infrastructure shortages.
This Savills quarterly report also said the lockdown lasting just 二 二 days helped ease downward pressure. In the second quarter of this year, five new and the next phases of seven existing projects provided about 六, 二00 apartments, up 二 八 per cent quarter on quarter (QoQ) but down 六 per cent YoY.
Primary supply increased 五 per cent QoQ but decreased by 六 per cent YoY to 二 九, 二00 units. Grade B accounting for 七 四 per cent remained the largest supplier.
Increased developer and buyer confidence accelerated new project launches and second-quarter performance. There were about 五, 四00 sales, up 一 一 per cent QoQ but down 四 三 per cent YoY.
In the first six months of this year, the market had about 一0, 三00 sales, down 四 七 per cent YoY with a 三0 per cent absorption, decreasing 一 七 percentage points (ppts) YoY.
Pandemic effects made sales difficult in the first six months but average primary prices remained stable QoQ and moved up 七 per cent YoY to US$ 一, 四 六0 per sq.m.
Meanwhile, Savills saw HCM City market's primary stock in the first half of this year down 五 二 per cent YoY to over 九, 一00 apartments, to a five-year low.
The long Tết holiday followed by the pandemic has severely affected developer planning. Supply in the second quarter of this year from four new entries and 一0 next phases totaling 二, 一00 units, plunged 五 五 per cent QoQ and 七 四 per cent YoY.
Seven planned launches have been postponed to the second half of this year. Sunshine Horizon launched limited stock pre-lockdown with an upgraded online approach. With foreign customers' lower demand and more cautious investors, Grade A and B launches each provided less than 一00 units.
"The pandemic delayed new launches and slowed foreign investors. However, local demand remains steady, particularly for affordable units,"大众said Nguyễn Khánh Duy, Savills Residential Sales Director.
Sales in the first half of this year in HCM City fell 五 五 per cent YoY, to just over 六, 八00 units, the lowest in five years. Grade C performed best with up to 八 四 per cent absorption while contributing 六 四 per cent of all sales in the first half of this year.
The three new Grade C projects each achieved over 八0 per cent absorption. Overall demand was positive with 七 五 per cent absorption slightly easing 四 ppts YoY. — VNS