Land prices surge amidst unconfirmed rumors in suburban Ho Chi Minh City

The prices have increased by 30 to 40%, even 100% in some areas, in District 2 and District 9, as well as outlying districts including Binh Chanh, Can Gio, Cu Chi, and Hoc Mon.

Along Nguyen Xien Street in Long Thanh My Ward, District 9, which was previously a secluded neighborhood, land prices have hiked after a rumor that a major realty project would be initiated later this month.

Advertisements have filled the area, while brokers hand out leaflets on a daily basis.

According to Van Anh, a broker, houses in a residential area named DV were first put on sale seven months ago.

Speculators began buying nearby land slots earlier this year, causing prices to rise, Anh elaborated.

Areas along Nguyen Duy Linh Street in District 2 have also been in high demand.

Hoang Nam, a local broker, stated that buyers of houses in the neighborhood have been mainly speculators while those having a real demand for residences make up a small portion.

Tuoi Tre (Youth) newspaper reporters have noticed a 20-50% increase in land prices along National Highway 50 in Binh Chanh District compared to the beginning of the year.

National Highway 50 is a major road leading to provinces in the Mekong Delta, Ngan, an experienced broker, explained, adding that Binh Hung Commune in the district is expected to be upgraded, leading to the price surge.

A 4m x 16m house, previously sold at about VND500 million (US$22,000), is now hard to find although the price has doubled, Ngan continued.

Land prices in outlying Can Gio and Cu Chi Districts have also spiked due to some hearsay that many developers will carry out their projects in the areas.

Caution

Against the backdrop of the ‘land fever,’ real estate experts recommend that buyers should be cautious before opening their pockets.

As major investors have occupied all profitable projects in downtown areas, smaller ones will seek for potential property in less prominent neighborhoods such as District 2 or 9, said Nguyen Xuan Loc, general director of Techcomreal, a realty company.

That the city’s authorities are developing infrastructure in suburban areas has been leveraged by brokers, boosting land prices, Loc added.

“Buyers should only choose those projects having a legitimate building permit, easy access, and connections to other infrastructure and sign deals with proper contracts to avoid pricing traps,” he suggested.

According to Tran Khanh Quang, general director of Viet An Hoa Real Estate Consultant JSC, investors should not be hasty as rumors can be false.

Even if they are true, they will only become a reality in three to five years, Quang elaborated.

Le Hoang Chau, president of the Ho Chi Minh City Real Estate Association, assessed that the ‘land fever’ is not related to a housing bubble.