HANOI’S property launches are outpacing Ho Chi Minh City, Maybank Kim Eng analyst Thai Quang Trung noted in a flash report on Tuesday (Jan 29).
But developers in both cities are facing slowing credit growth, as bank lenders get more selective, while mortgage customers are not easy to grow because of under-developed credit rating systems for mass market home buyers, the report added.
Maybank Kim Eng noted that pre-sales value in Hanoi could grow at the same pace in 2019 as in the previous year, with prices having stayed flat as household disposable income picked up.
Still, “pre-sales have tended to grow in line with launches in the current cycle”, said the report, as Hanoi housing supply picks up on timely approval of developers’ plans. Meanwhile, launches in Ho Chi Minh City have slowed on closer scrutiny from the authorities.
“Over the past few years, Ho Chi Minh City’s infrastructure development is notably behind that in Hanoi,” said Maybank Kim Eng, which called itself “not constructive on most Ho Chi Minh City-based developers at this juncture”.
“This further adds to the difficulties in launching projects outside of Ho Chi Minh City’s central area, most of which are mass-market projects.”