According to a report of JLL, land values within Thu Thiem have increased considerably but reasonably by 30 to 40 percent within past three years. This is due to the low base of initial land values, the ever-increasing speed of infrastructure construction and the strong demand for recent residential projects launched in Thu Thiem. Besides, Thu Thiem is seen as the largest undeveloped clean and clear, master planned land within the city centre.
On average, Thu Thiem’s land price is approximately one-third of district 1 and relatively low compared to neighbouring districts such as district 3 and 4. In addition to land values appreciating in Thu Thiem, the neighbouring areas in district 2, such as Dong Van Cong, An Phu and Thao Dien have also witnessed increasing land prices.
With rapid urbanisation, the establishment of Thu Thiem projects and some improvement in the legal and planning framework, it is reasonable to say that land prices will continue to increase over the coming years.
Launched in 2015, Dai Quang Minh’s Sala project has sold 95 to 100 percent and recorded a 30 to 35 percent increase in sales prices compared to when the units were first launched.
The Empire City project commenced a soft launch in December 2016 and a subsequent launch in July 2017, with the projects named as Linden Residence and Tilia Residence, respectively. Both residential projects, totaling up to approximately 1,000 units, are almost sold out within the first few weeks of the launch.
With a booming high-end residential market and the abundant opportunities for commercial development, district 2 has become the focal point for large-scale developments in the past three years. Because of the quality of the master plan and the proximity to District 1, Thu Thiem is possibly the most attractive part of District 2.
“Despite the recent increase in transaction volumes and price, the current cycle has yet to reach its peak,” written in the report.
It is forecasted that the supply of apartments in Thu Thiem area will rise in the coming years as a new wave of luxury branded apartments from major investors is expected to hit the market.
JLL said that this new wave of supply would not create a decrease in the property prices but might establish a new price level in Thu Thiem as the urban area becomes more developed with value-added services, such as schools, hospital, entertainment centres, etc.
The apartment selling price is predicted to keep on rise, which will be an offset, helping the investors achieve the expected return in the context of land prices increase.
Given a growing economy with strong demand from the buyers who either have cash-on-hand or the ability to leverage, it is likely to see that the buyers are taking a long-term view in their purchase decision, which is a positive sign for Thu Thiem.
