Southern land sales plunged by more than 90% in the first quarter as buyers were reluctant to make purchases in an unfavorable market.
Land sales plunged 94% year-on-year in the economic hubs of Ho Chi Minh City, Dong Nai, Binh Duong and Long An, according to a report by property consultancy DKRA Group.
Land trading companies are struggling to sell.
A company that mostly owns land in Binh Duong Province saw sales plunge year-on-year in the first three months with only a few lots sold this year with nearly nonexistent demand.
Another company that sells land in Long An Province recorded almost zero sales in the first quarter. The number of inquirers dropped 90% year-on-year, and no one has put down a deposit for the entirety of 2023 so far. The company has never seen sales vanish like this in five years.
Individual investors are struggling to liquidate their assets. Nguyen in Long An Province has been trying to sell a land lot since mid-2022, but has failed to find an interested buyer in a year.
He has lowered the property’s price by 22% over the last eight months and plans to bring it down further in the second quarter this year.
Property broker Doan in Dong Nai was not able to sell any land in the first three months of this year. He made his first 2023 sale this week.
The situation is a complete contrast to the first quarter of last year when he was able to sell up to 10 land lots a month.
Industry insiders say that land prices have dropped by around 10%, and some sellers who are in a desperate financial situation are willing to give discounts of up to 20% to get quick cash.
Interest in land has also dropped. Listing platform Batdongsan saw searches for land in southern Vietnam drop 32-45% year-on-year in February.
There seems to be no recovery in sight for the short-term, a report by the platform said.
Vo Hong Thang, deputy director of research and development at DKRA Group, said that prices could fall even lower as sellers and buyers have yet to come to an agreement.
Land is not the type of asset that must be bought quickly for residential purposes, therefore buyers buy it as a long-term investment asset and intentionally wait for better prices instead, he added.
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