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 Urgent steps necessary to boost real estate market

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mrthought



Number of posts : 111
Registration date : 2011-03-03

PostSubject: Urgent steps necessary to boost real estate market    Tue Aug 23, 2011 2:05 pm

Along with urgent solutions that the gloomy real estate market requires at this time, Ministry of Construction and experts said that enterprises also have to rescue themselves before waiting for “miracle” from banks, the VnExpress reported.
Data from the National Finance Supervision Committee last week showed that by June 30, the property-backed outstanding loans accounted for 9.94% equaling to 245 trillion dong of total outstanding loans of the banking sector.
Dr Le Xuan Nghia, Vice Head of the Committee said, while some nations like Thailand and Malaysia, the ratios were reported at 6% and 7% respectively, Vietnam’s remained very high. Noticeably, the lending ratio was high at small sized banks, especially at 30-40%.
“More danger is the internal lending matter. Some bankers are also owners of big realty projects”, Nghia warned. Quality of bank assets will be threatened seriously if the property market remains gloomy.
With the confirmation that the real estate market relies on bank credits and cross risks between two sectors are very high, Nghia added, rescuing the market is not simply depending on macro economy.
“Recovery of the realty market does not depend on objective opportunities any more, it takes time. If the government’s Resolution 11 is implemented seriously, inflation will start to go down by 2012 early whereby the interest rates are expected to be cut. Banks may relax credit for feasible and effective projects, by that time the real estate may recover as a result”, he confirmed.
Peter Charleton, Senior Expert at National Irish Bank said that relaxed administration, massive lending pushed Ireland’s real estate to fall in the bubble situation. Our advice for Vietnam is that you should not lend at low interest rates, should focus on effective business instead of wasting on ineffective projects.
Vietnam’s realty market since May has continuously fallen, most transactions stood still. An array of big projects namely Geleximco, Van Canh, Bac An Khanh…have kept silent. Many project owners offered prices lower 5 million-10 million dong/square meter compared with initial expectation.
According to Ministry of Construction, the real estate prices will decrease, leading to impacts on the production of ceramic and cement.
Experts assessed, Vietnam’s realty market has been shaped for 10 years so the financial strength and capital remain limited. Even, the giants like Housing and Urban Development Corp (HUD) and Vinaconex also are managing small capital source. For each project covering tens of hectares, the compensation will be trillions of dong and money amount for using land will be also a huge figure. As stated by Vice Minister of Construction Nguyen Tran Nam, this is the high pressure amid anti-inflation context because real estate is under capital control.
Enterprises need to joint venture, association and select products with high liquidity in order to have quality supply to obtain consumer’s belief. There has no miracle to push up the real estate sector, Mr Nguyen Tran Nam noted.
The market has not come into the bubble danger that may collapse the real estate credit but there are some signals. The property-lending ratio of 9.94% still is in the safety threshold, but the bad debts are tending to rise.
Factually, realty developers only are boosting investment in high quality products and high-class housing while only 28% of people are able to access the type of housing. In Hanoi, there is no housing product at less than 25 million dong/sqm, mainly at 27-28 million dong/sqm.
In addition, according to Nam, the state needs to develop apartment buildings. Vietnam has a thick density higher 10 times than the global average and 2 times than China. Sentiment to own private houses still is hampering the task of developing and projecting urban areas.
He cited, Singapore, a five million population, has completed the 1 millionth house while the government has used only 250 square kilometres for building houses, much lower than Hanoi’s 3,500 square meters.
“2009 population census showed that the ratio of renting houses accounted for 4%, especially over 14% in Hanoi and HCM City while it is 50% in Japan and US. So, it is necessary to construct tenement and then change ownership form”, he remarked.
Read more News about real estate in vietnam



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andrew123



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PostSubject: Re: Urgent steps necessary to boost real estate market    Mon Oct 10, 2011 12:06 am

Basically you want to cut out all sweet, fried, processed, junk, and fast foods. Learn proper serving sizes. Eat several smaller portions throughout the day like 3 small meals and 2-3 healthy snacks instead of 3 larger meals.

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