Hanoi sees development prospects of real estate market in East: experts

Đặng Xá urban area in Gia Lâm District, east of Hà Nội has prospects for development of its property market in the future. — Photo greenlinkcity.com

HÀ NỘI — Synchronous development of transport infrastructure and abundant land in the east of Hà Nội will attract investors, although the city's whole real estate market has gloomy forecasts for development, according to experts.

The property market in the east has late development but has great advantages in terms of traffic infrastructure, land available and mechanisms to promote the development of the real estate market there, Assoc. Dr. Trần Đình Thiên, former director of the Vietnam Institute of Economics and a member of the Prime Minister's Advisory Group, said at a conference on prospects of developing a new urban area in the east of Hà Nội.  

Thiên noted that Hà Tây Province was merged into Hà Nội in 2008, followed by the western area of Hà Nội developing strongly. At that moment, Hà Nội's eastern region was still a quiet market.

But now, the eastern region is on its way to becoming a potential property market, promising to attract a large number of investors.

He said that the eastern region is heading towards sustainable and synchronous development, including infrastructure. Rural Gia Lâm District will be converted to an urban district this year.

“Hà Nội's eastern area is planning to become a modern urban location in the capital. This region will quickly accelerate to become the ideal investment destination in the Hà Nội real estate market," Thiên affirmed.

Also at this conference held by the Vietnam Association for Real Estate Brokers (VARS), VARS chairman Dr. Nguyễn Văn Đính said that in the past five years, and especially during this difficult period, the real estate market in the eastern region has developed strongly to create many advantages and an impressive price increase. That is attracting a lot of domestic and foreign investors.

Lê Đình Chung, general director of SGO Homes Real Estate Development and Consulting JSC, a member of the VARS Market Working Team, said that in the  2008-18 period, investors only mentioned the western and northern areas of the city. 

In the past five years, the real estate market in the east of Hà Nội witnessed a strong change with the development of a series of "all-in-one" mega-urban projects with synchronous and modern infrastructure, he said.

The demand of property investors before 2020 was mainly investment. However, after 2020, the region has attracted more customers buying to stay, he said. 

In the coming time, the urban area in the east will receive a wave of population displacement from the ancient street area of Hà Nội which has a large population located in limit ed land. This area is also a preferred choice for customers in neighbouring provinces and cities of Hà Nội.

Vũ Hà Thu, deputy general director of Newstarland. said people no longer care how far away places are. Therefore, even though it is a suburb of the capital, if it is synchronously planned in terms of infrastructure, people will still choose the place to live, for example.

“Although the real estate market is facing many difficulties in the last six months of the year, there are still opportunities for recovery, especially in areas with infrastructure that is focused on investment and planning like the area in the east," Đính emphasised.

VARS expects that the supply in the east will grow strongly. Many projects have been implemented and put into operation, creating connections with the inner city and neighbouring provinces and cities. This will also promote fast and strong economic development in the region in the coming time.

According to the Red River Urban Subdivision Planning Project, the East will benefit when there are six new bridges spanning the Red River, connecting the two banks of the city, namely Hồng Hà, Thượng Cát, Tứ Liên, Trần Hưng Đạo, Ngọc Hồi and Mễ Sở. They will shorten travel times and contribute to relieving population density pressure for the inner districts of Hà Nội.

Along with the urban residential real estate segment, industrial real estate in the east of the capital is also likely to grow strongly in the future.

In the next three years, the eastern region of Hà Nội will become the leading property market in the supply of apartments with nearly 92,000 units. Future supply in Hưng Yên will attract buyers to stay as well as investors from Hà Nội and neighbouring provinces.

The trend of shifting production from other countries to Việt Nam, especially in the northern region, will also make the demand for high-end accommodation for foreign experts increase. Now, the supply of high-end housing products does not meet the demand lin the industrial centres near Hà Nội such as Bắc Ninh and Hải Dương. Therefore, this supply will likely come in the form of the east of Hà Nội where there are already high-quality residential areas such as Ecopark and the Vinhomes Ocean Park.

The primary price has continued to increase, while the secondary prices are likely to continue to trend down in the next quarters from the peak but at a slower rate.

However, it is difficult to reduce deeply because the initial investment price is high and the actual demand is still large. Investors could still make a lot of profit if they buy property products without an intermediary.