Industry insiders are weighing up how to
break the icy property market. Vietnam Real Estate Association general
secretary Phan Thanh Mai said the only way was up for investors as the worst
time for property trading firms was in 2011’s fourth quarter.
Actually,
a sequence of property projects faced delays and extended progress on the back
of credit squeezes in 2011, seriously affecting market liquidity. Most property
developers were starved of capital, particularly those with a pipeline of
projects under development.
Mai
said the market inundated with a massive number of property project several years
ago with the construction of 486 new urban area projects from 20 hectares to
1,000ha across the country had not helped the current situation.
These
new urban areas cover a total 74,057ha and Hanoi alone accommodated 200 such
projects for implementation during 2011-2013 with over 60 per cent involving
housings and new urban areas.
“It is
time for property firms to revise their business plans to materialise profit
targets, a worthwhile opportunity that should not be missed,” Mai said.
Bank
figures show that deposits from the community into banks continued to surge in
the first quarter of 2012, reflecting people’s cautious approach to risk-prone
investment channels including property, according to BIDV’s senior advisor Can
Van Luc.
Luc
assumed strengthening business operations through cutting down costs and hiking
labour efficiency, perfecting legal records to minimise the possibility of
customers delaying their obligations, diversifying and making use of diverse
capital sources and striving to drain out stockpiles would be the best options
to property firms at this point of time.
In the
long haul, firms needed to modify their business strategy avoiding too many
firms acting in the same market segment and enhance governance expertise
through applying world-class risk management and business administration
standards.
“Property
firms should not repeat the fault and learn to forge ahead from their
wrongdoings,” said Luc.
VIR
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