Ho Chi Minh City: The level of 2.4 billion VND per m2 of land Thu Thiem has just successfully auctioned pushed land prices to a record high, affecting all housing segments, according to experts.. 

Mr. Tran Quy Thanh, CEO of Tan Hiep Phat Beverage Group was present at four auctions on December 10, 2021. Photo: Siddhartha

The results of the auction of 4 plots of land in the rich street of Thu Thiem, Ho Chi Minh City in the past few days caused a stir in the real estate market when it officially established the historical price of the whole country.

Of the four land lots successfully auctioned, plots 3-8 and 3-5 reached 470 and 590 million dong per square meter, respectively, and plots 3-9 reached the milestone of one billion dong per square meter - the highest on this peninsula.

The last auction was the land lot numbered 3-12, with the starting price of more than 2,942 billion VND. In the auction of plots 3-12, 15 units participated in the auction with familiar names of the market such as Capitaland, Ha An Real Estate, Phat Dat, Quoc Loc Phat...  with 70 bids. Winning the auction was Viet Star Real Estate Investment Co., Ltd with an amount of VND 24,500 billion (2.4 billion per m2), 8.3 times higher than the starting level, having hit the market price ceiling in Ho Chi Minh City is also the biggest land price record in Vietnam. Land lot number 3-12 has an area of ​​​​nearly 10,060 m2, the purpose of use is a mixed-use apartment building (multi-functional residential land) with a combination of commercial and service functions. The land area is built with 4-25 floors and 2 basements, the maximum construction density of the podium is nearly 70% and the tower block is nearly 45% of the land area. The maximum population for this land is 3,420 people, with 570 apartments and 5% of floor space for commercial use.

According to the detailed planning project of 1/500 scale, the land lot 3-12 has a total construction floor area (GFA) of 90,000 m2, the land use coefficient is 8.95 times and the number of apartments is expected to be 570 apartment. Thus, the price of each apartment will be about VND 42.9 billion, equivalent to about VND 340 million per m2 with a construction rate of 80% GFA. This is the price excluding construction costs and business profits.

Land use coefficient and commercial area of ​​4 land lots in the auction on December 10, 2021. Chart: TL.

The apartment price report in Thu Thiem has just been announced by a reputable real estate company in the fourth quarter of 2021, the price of apartments located next to the river on this peninsula recorded the highest level of about 210 million VND per month. m2.

According to a survey of real estate companies specializing in District 2, land prices at riverside locations around Thu Thiem peninsula range from 350-400 million dong per square meter, but few products are offered for public sale. on the market.

Whether it is a townhouse or an apartment, and even riverside land in Thu Thiem area, no asking price has been recorded that exceeds the threshold of VND 400 million per square meter, which is always lower than the price of land on the financial street of Ho Chi Minh City (about 500 million VND per square meter). million dong per m2) and has not kept up with the land price of Dong Khoi, Nguyen Hue and Le Loi streets (the highest is about 1.4 billion dong per m2).

Sharing with VnExpress, many experts predict that this auction result will affect all aspects of the real estate market in the near future (whether the auction winner pays enough money to buy the auctioned property or not).

Real estate welcomes a new land fever

The last Thu Thiem land auction recorded a milestone of VND 2.4 billion per m2, an increase of 8 times compared to the initial offering, which certainly has a direct impact on all housing segments in the market according to the regulations. congestion (land prices increase and spread from one area to another, from the high to the low segment).

Mr. Tran Khanh Quang, General Director of Viet An Hoa Company, said that the auction results of 4 land lots in Thu Thiem on December 10 with the milestone of VND 2.4 billion per m2 in this new urban area officially pushed the market. Real estate entered a new land fever with an increase in price margin of 8 times the starting level.

Mr. Quang said that the market for luxury houses and luxury real estate has been marketed as a good transaction in recent years, but in reality, there are still many doubts about virtual prices. At this auction (new fever), the land price in Thu Thiem new urban area skyrocketed to 2.4 billion VND per square meter, higher than the old center area (the highest in District 1 was about 1.4-1 million VND). 5 billion VND per m2) is considered to be the legalization of the prices of super luxury houses appearing on the market today.

Historically, land crazes have had a duration and for the most part happened quickly and ended quickly. However, according to Mr. Quang, the land fever in Thu Thiem, seen from the past land auction, may have a long-term impact on the real estate market because the land auction process in this prime peninsula is expected to still take a long time. next time.

Mr. Le Hoang Chau, Chairman of Ho Chi Minh City Real Estate Association (HoREA), analyzed that businesses that won the Thu Thiem land auction last round have the right to implement the project within 24 months, in case the project is adjusted or Application for extension can take 3-5 years, even longer. Therefore, the last land auction ceiling of VND 2.4 billion per m2 in Thu Thiem is understood not as the current price but as the expected future price, leading to possible long-term effects on the supply-demand mismatch. housing for many years to come.

Expanded central real estate

Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), said that after the auction of 4 land lots in Thu Thiem on December 10, it set a record of VND 2.4 billion per m2 of land on the peninsula belonging to Ho Chi Minh City. In this district 2, the concept of downtown Ho Chi Minh City has officially changed.

The central area of ​​Ho Chi Minh City was previously understood as the area of ​​District 1, and the central core is often limited by a rather narrow radius around Nguyen Hue, Dong Khoi, and Le Loi streets, which always have the highest land prices in the market. ; At the same time, it is also the highest in the announced city land price list. However, after the last billion USD land auction, the land price along the arc boulevard on Thu Thiem peninsula has surpassed the land price of the 3 highest roads in District 1, and at the same time repositioned the concept of the center of Ho Chi Minh City. in the direction of expanding to the two banks of the Saigon River.

According to Mr. Chau, the old downtown area from District 1 is gradually expanding to the new center on Thu Thiem peninsula, in District 2, and in the future may expand to other districts with borders located along the East Coast and West bank of the Saigon River. Land prices at locations along the riverbanks, therefore, can turn to a new page when compared to the old downtown area, or even higher.

Source: Compilation