Shortly after the announcement of Vingroup’s new affordable housing brand, Vincity, another luxury real estate developer is entering the low-cost housing market.
Just days after Vingroup revealed its plans for low-cost housing in seven localities across the country, real estate developer Muong Thanh also announced its intention to build affordable units, reports Zing.
At a recent real estate seminar, experts discussed the current state of the housing market, namely the imbalance between supply and demand of affordable housing.
Former Deputy Minister of Natural Resources and Environment Dang Hung Vo voiced his concern that the affordable housing shortage would continue in 2017. According to Vo, Saigon’s supply of affordable housing in 2014 was just 27% of the overall market; this figure fell to 25% in 2015 and again to 20% in the first nine months of this year.
Meanwhile, the southern hub’s high-end housing supply accounted for 45% of the total in 2014. Though it’s also fallen – to 40% in 2015 and 31% in the first three quarters of this year – affordable housing makes up 80% of the total housing demand, while luxury housing is just 20%.
Though several real estate firms have launched social housing projects in recent years, their involvement still does not cover the full demand, the news outlet reports. Some experts are optimistic, however, that the entry of Vingroup and Muong Thanh into the affordable housing market will encourage other firms to follow suit. Regardless, 2017 will still be a tough year for first-time homebuyers.
“This is a paradox we need to solve in 2017,” Vo said of the unbalanced supply and demand, according to Zing.
In Saigon, Vingroup’s Vincity housing will be in Districts 7 and 9. The real estate giant also plans to develop housing in Hanoi, Hai Phong, Hung Yen, Thanh Hoa, Ha Tinh and Nha Trang, while Muong Thanh is currently developing affordable housing in the capital.
Once complete, the two firms’ housing will run between VND10 million and VND15 million per square meter.
[Photo via Link Hay]
