REAL ESTATE TRANSACTIONS DECLINE SHARPLY IN THE FIRST HALF OF THE YEAR

The real estate market experienced a noticeable slowdown in transaction activity during the first half of the year, despite a continued increase in housing supply. Rising borrowing costs and cautious buyer sentiment remained the main factors affecting market liquidity.

According to market reports, newly launched housing products continued to increase, contributing to a larger primary housing inventory compared to the same period last year. However, the number of successful transactions declined significantly, indicating that stronger supply has not yet translated into higher market absorption.

Market analysts noted that the average absorption rate also weakened across most regions. Northern and Southern Vietnam continued to account for the majority of transactions, while Central and Mekong Delta markets recorded comparatively lower demand.

Research on the two largest property markets also showed that although thousands of new apartments were introduced in Hanoi and Ho Chi Minh City during the second quarter, sales performance remained below expectations. The findings suggest that buyers have become more selective when making purchasing decisions.

One of the primary reasons behind the slower transaction volume is the higher cost of financing. As preferential lending programs expire, home loan interest rates have generally increased, making it more challenging for both first-time homebuyers and investors to secure affordable financing.

Financial institutions have also observed that credit growth has outpaced deposit growth, creating continued pressure on lending rates. This environment has led many potential buyers to postpone purchase decisions while waiting for more favorable financing conditions.

Industry experts believe the market is entering a period of adjustment after the strong recovery seen in previous years. Instead of broad-based price increases, residential property prices are becoming more stable, reflecting a more balanced relationship between supply and demand.

In response to current market conditions, buyers are prioritizing projects with transparent legal documentation, reputable developers, completed infrastructure, and genuine residential value. At the same time, developers are focusing on more flexible sales strategies, including attractive payment schedules and financial support programs, rather than relying solely on direct price discounts.

Looking ahead, many market research organizations expect the real estate market to remain cautious during the second half of the year. Housing supply may continue to improve, while prices are likely to remain relatively stable with only modest increases. Investment demand is expected to concentrate on projects that offer clear legal status, reliable development progress, and strong long-term value for owner-occupiers.