In 2023, except for some positive signs from the apartment market segment, other segments saw sharp decreases in supply and demand. Da Nang is known as the home of resort real estate, but the market was gloomy last year.

Condotels, for example, saw remarkable falls in primary supply, 61 percent of the same period of the year before. The products available were mostly inventories of projects launched in previous years.

The market demand was low with sales at the lowest level in 10 years and equal to 3 percent of 2022. Successful transactions were seen mostly in low-cost market segments, with prices at VND3-4 billion for an apartment.

Quang Nam province remained the leading market which accounted for a large proportion in supply and consumption, 58 and 92 percent, respectively. 

The national economy has recovered, but slowly, while the number of foreign travelers is predicted to see a slight growth rate, and cash flow from tourism has not seen a breakthrough. Analysts believe that the condotel market is now likely to see prosperity in the short term.

Regarding the resort real estate segment, there were 10 projects in the primary market, with 245 products, down 38 percent.

The primary supply remained low, mostly in Quang Nam and Thua Thien-Hue, which accounted for 86 percent of total supply.

The general demand decreased significantly to a 5-year low, just equal to 7 percent of that in 2022. The number of transactions dropped in nearly all products ,with just 11 products transferred, down 93 percent.

The primary market of townhouses and shophouses continued to see a downward trend, with only 36 units sold, down 84 percent over the same period the year before.

Prices in the primary market did not see major fluctuations, and were offered at VND7.1-16.3 billion. The secondary market was still lackluster, with no transaction reported. There were 15 projects available, which were from projects launched in previous years.

Many projects were suspended because of legal problems and investors’ weak financial capability. The market difficulties had a negative impact on investors’ sentiments, thus lowering liquidity since the second half of second quarter in 2022.

As demand was slow, only 161 products were sold, down 84 percent. Transactions were mostly made in semi-detached houses with average prices of below VND10 billion per house. The average prices dropped by 5-7 percent, and the products transferred were mostly from projects which have been slow in execution and have legal status problems.

The land market was also in a slump. DKRA Group reported that eight projects were for sale with 696 land plots, a considerable decrease of 74 percent compared with 2022.

The ratio of consumption to new supply was 31 percent (218 land plots), just equal to 15 percent of the previous year. Most transactions were made in the first half of 2023 and with products priced at VND44.5-59.5 million per sq m in Da Nang, and VND10.6-11.3 million in Quang Nam.

The primary prices saw decreases of 7-9 percent on average compared with the previous sale campaigns. The secondary market saw price decreases of 8-10 percent compared with early 2023.

In terms of apartments, 14 projects were put up for sale with total primary supply of 1,730 products, up 29 percent over 2022, mostly in Da Nang.

The ratio of consumption to primary supply was 42 percent (734 products), up 66 percent. The apartments transferred were mostly mid-end ones, priced between VND50 million and VND60 million per sq m.

The primary sale prices increased slightly by 3-5 percent. Meanwhile, in secondary market, the prices were slashed by 2-6 percent compared with early 2023.

DKRA predicted that there would be 800-1,000 new apartments in 2024, mostly in Da Nang, while primary prices will remain unchanged or go up slightly. Meanwhile, land supply may slightly decrease in 2024 (450-550 land plots). No breakthrough is expected in the short term.

Nguyen Hien