House prices rise despite of COVID-19 impact

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The agency said house and land prices surged sharply in 2020, especially in the first two months this year.— Photo kyguinhadat.vn

HÀ NỘI — House and land prices in Việt Nam have continued to rise – despite the effects of COVID-19.

Now the Ministry of Construction has compiled a report to determine exactly why there has been a sharp increase in prices.

It is concerned some real estate agents may have inflated prices for their own gain.

The agency said house and land prices surged sharply in 2020, especially in the first two months this year.

Property prices in some places have increased by more than 10 per cent compared to early 2020.

The agency reported that despite many difficulties and challenges in the past year caused by both the pandemic and natural disasters, the real estate industry alone contributed about 4.42 per cent in revenues to the State coffers.

It said in the past, the Ministry of Construction proposed Government build more social housing for low-income earners in urban areas and industrial zones.

The ministry has conducted routine compliance inspections on investment and business practices at big real estate firms, real estate investment.

The inspections were designed to prevent false house pricing, and inaccurate estimates to stop unscrupulous real estate agent from gaining a financial advantage.

This has helped keep house and land prices stable, compared to 2019.

Thu Hằng, a senior official of Savills Hanoi, believes as the economy grows post-pandemic, there will be more opportunities for people to buy or rent a property.

She feels urbanisation has not kept up with population growth, causing a drastic imbalance between supply and demand.

The report also said rising costs in building material and fuel has also played a part in the price hike.

In addition, local authorities nationwide are selling land to private developers at inflated prices.

The knock-on effect has contributed to a rise in property prices.

A solution to stabilise the market

According to the Ministry of Construction, managing and stabilising the local real estate market, the ministry has actively studied and submitted many solutions and policies to the Government with a view to minimise imbalance between supply and demand to meet market demand.

In particular, the Ministry had submitted draft decrees on amending and supplementing the No. 99/2015 detailing and guiding the implementation of a number of articles of the Law on Housing and Decree of Government No. 100/2015/ND-CP dated October 20, 2015, development and management of social houses.

This year, the ministry will submit proposals to amend current policies to both the National Assembly and Government.

The Ministry will ask Government to instruct cities and provinces to strengthen supervision of real estate development and investigate any organisation thought to be cheating the system. — VNS

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