More mergers and acquisitions are imminent in the property market and real estate prices are likely to escalate this year, industry insiders said.
David Jackson, CEO of real estate services provider Colliers Vietnam, said since the Covid-19 pandemic has caused the industry to suffer losses many businesses would no longer be able to complete half-finished projects and be forced to sell out to others with deeper pockets.
Those with strong finances are also likely to opt for M&A deals since little land is available to strike out on their own, and they would especially try to buy out unfinished projects and bring them quickly into the market he said.
In the next 12 months Vietnamese companies would continue to play a key role in real estate M&A thanks to their better understanding of the market than foreign firms, he said.
He predicted that most M&A deals would involve projects on the outskirts of large cities or in provinces that have recently emerged as new economic hubs, a trend that has already been seen.
Tran Khanh Quang, CEO of Viet An Hoa Real Estate Investment Joint Stock Company in HCMC, said in 2022 the property market is likely to see prices rise to new highs due to the impact of the auction of four land plots in the Thu Thiem New Urban Area in Thu Duc City recently.
They were sold to local bidders on Dec 10, 2021 for a total of more than VND37 trillion (US$1.6 billion), or four to eight times their reserve prices.
The destruction the fourth wave of Covid wreaked on various industries has caused investors to shift their money into houses, lands and other types of real estate as a “safe haven”, he said.
Bids for lands in Thu Thiem are expected to continue because there are still many land lots available there, and are likely to drive property prices up, he said.
Nguyen Loc Hanh, CEO of Asia Gem Real Estate Investment JSC, said prices, especially of housing, in the city and its neighboring provinces are likely to increase in 2022 since land prices, construction costs and loan interest would all go up.
Besides, inflation in the coming years are also likely to cause property prices to rise, he warned.
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