THE MINISTRY OF CONSTRUCTION REQUIRES HANDLING SPECULATION AND INFLATING LAND PRICES.

The Ministry of Construction has requested local authorities to strengthen control over the real estate market due to the phenomenon of spreading rumors, speculative buying and selling to drive up property prices.

In a letter sent to localities, the Ministry of Construction assessed that the real estate market has not developed sustainably in recent times and has many potential risks. Among them, there is a situation where investors and brokers spread rumors, engage in speculative buying and selling, “causing information disorder to push prices up for personal gain.” Recently, some land auction sessions have resulted in prices that are several times higher than the starting price. The Ministry believes that this has had an impact on the socio-economic development and healthy development of the real estate market.

In Hanoi, the prices of apartments in certain projects or individual houses in areas such as Tay Ho, Hai Ba Trung, Ba Dinh, Hoai Duc have abnormally increased compared to the market

situation and people’s demand. The Ministry’s Q2 report shows that apartment prices have increased by about 5-6.5% compared to the first three months of the year. The sharp increase of 28-33% is concentrated in some old projects that have been operating for many years. In some cases, even resettlement areas have seen a 20% annual price increase. Some newly launched apartment projects in Hanoi have prices starting from 55 million VND per square meter.

However, the Ministry of Construction assesses that the surge in apartment prices “only occurred in a short period” and showed signs of slowing down in the end of Q2. This is due to a 30% decrease in apartment and individual house transactions compared to the beginning of the year, caused by high prices and buyers adopting a wait-and-see attitude.

The Ministry recommends that local authorities control the practice of multiple buying and selling, especially in areas, projects, and apartment complexes where there are abnormal price increases.

If there are acts of price manipulation or speculation, local authorities need to take appropriate measures to address them.

The Ministry also requests a review of land auction organization and strict management of land subdivision to limit the situation of “price manipulation” that disrupts the market.

Một khu đất đấu giá tại huyện Hoài Đức. Ảnh: Phạm Chiểu

(An auctioned land in Hoai Duc district).

The guidance of the Ministry of Construction comes in the context of consecutive land auctions in the outskirts of Hanoi attracting thousands of registration files with winning prices exceeding hundreds of millions of Vietnamese dong per square meter, causing a stir in the market. At the same time, the apartment segment continues to increase in price, surpassing the affordability of the majority of the population. In the Official Dispatch on August 21, Prime Minister Pham Minh Chinh also requested the rectification and strict handling of violations in land use rights auctions.

Decree 96, which took effect from August 1, has added market regulation measures. Accordingly, the ministries and localities will propose market regulation solutions when real estate prices increase or decrease by more than 20% within three months. However, some experts believe that price fluctuations in the real estate market are determined by supply and demand, so it is not possible to intervene with orders to change transaction prices.

According to the VNEXPRESS.