Colliers International Vietnam HN Market Insights Q22015 - Condominium Sector (ENG)

1. SUPPLY
As of Q2 2015, five new large Condominium projects came online (Hoa
Binh Green City, Trang An Complex, Imperia Garden, The Manor Central
Park, and FLC Garden City), supplying approximately 3,000 units to the
primary market, up 3% q-o-q.
In terms of supply by grade, low-end to mid-end continued to dominate
the housing sector in 2015 with up to 60% of total supply. The luxury
segment remained in the CBD including Hoan Kiem and Hai Ba Trung
District with a total stock of approximately 2,200 units.
PERFORMANCE
Q2 2015 showed signs of increase in both transaction volume and price,
particularly in projects in the secondary area with good location linked
with the city centre and lower pricing.
In terms of total sales, there were more than 3,000 apartments reported
to be sold in all segments. Low to mid-end products were best absorbed
due to affordable prices and encouraging monetary policies from lenders,
ranging between US$800 to US$1,150/sqm and between 65 and 85sqm
in size.
In terms of pricing, there was an increase in the average price of newly
launched units, particulary in projects with high-quality uses or powerful
sales incentives, up 1% q-o-q. High-end and low-end sectors had highest
increases, up 2% and 3% y-o-y respectively.
DEMAND
High-rise condominium projects are becoming a favourable residential
format in Hanoi in recent years, gradually replacing individual houses with
the benefits of fully equipped facilities and security. Since more investors
are entering the market with great support from positive investments
policies, the residential market is promised to advance with better
graded projects and commitment to construction progress from mature
developers, which positively impacts on the demand side.
CONDOMINIUM SECTOR
Q2 2015 | MARKET INSIGHTS
HANOI
Figure 1: Supply by grade
ECONOMY OVERVIEW
Vietnam has experienced a positive sign of the economic recovery in
1H 2015 when GDP grew 6.28% y-o-y, which is the highest level in the
last 10 years. The consumer confidence index also witnessed significant
improvement when reaching 143.1 points, up 10 ppts y-o-y compared to
the average target of last year.
Total disbursement rate in the foreign funded projects grew by 9.6%
y-o-y to US$6.3 billion. In which, real estate sector continued to attract
lucrative foreign direct investments with 13% of total new FDI, placed at
second after manufacturing.
In parallel with the new legal amendment of the Vietnam Housing Law
came into effect in July 1st 2015 allowing foreigners to legally own, sell and
transfer their properties will boost confidence in property investments.
Short-term Outlook Luxury High-end Mid-end Low-end
Absorption rate
Primary Price
Construction
Table 1: Market Snapshot
DAVID JACKSON
General Director
david.jackson@colliers.com
PLEASE CONTACT US FOR ANY INFORMATION
TRAN NGUYEN
Business Development Manager
tran.nguyen@colliers.com
www.colliers.com/vietnam
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©2015 Colliers International Research
Project District Total units
Average
asking price
(US$/sqm)
Hoa Binh Green City Hai Ba Trung 800 1,580
Mandarin Garden Cau Giay 1,125 1,534
Thanh An Tower Thanh Xuan 352 1,282
Trung Kinh Complex,
Home City
Cau Giay 1,200 1,190
Wartermark Ho Tay Cau Giay 128 2,280
HP Landmark Tower Ha Dong 1,124 801
Diamond Blue Thanh Xuan 200 870
Table 2: Significant projects being completed in 2015
*Price excludes VAT
OUTLOOK
2015 will continue to see launches from both new projects
and new phases of existing projects to keep up with the rising
demand. An approximate of 19,000 future units will come online,
mainly located in the West and the South West of the city,
accounting for 60% of total supply. Mid-end segment is expected
to be the major supply of the future market, accounted for 50%
of total future supply in 2015.
0
20,000
40,000
60,000
80,000
100,000
120,000
No. of units
Source: Colliers International Research
High-end Low-endLuxury Mid-end