Should you put money into an apartment, experts give valuable advice

Recently, the apartment market, especially used apartments, has been quite vibrant and prices increased dramatically right after the Lunar New Year. Should I invest money in apartments at this stage? If investing, what risks should you pay attention to? Real estate expert Tran Minh shared with reporter Dan Tri about the above topic.

3 groups of apartment investors, the third group is the largest and also the most risky

There are many opinions that this is the time to “fever” the price of apartments. apartment buildings, so investing at this stage is potentially risky. What do you think about this statement?

– In my opinion, apartment investments are currently divided into 3 groups:

Group 1 is a speculative group. They will buy and sell immediately without holding long-term. And now that the price of old apartments is no longer “low-lying”, this group will look for other types of real estate . If this group withdraws quickly, it will be less affected.

Group 2 is to buy and accumulate assets finance, investing in apartments takes a long time 7-10 years plus rental income, the average investment in apartments is 8-10%/year. If bank interest rates return to normal, investing in apartments is not as effective as other types of assets. But in return, the asset accumulation group finds apartments safe, easy to liquidate, and has easy cash flow for rent.

This group is exactly what they are That means accumulating assets is not too influential. This type of investment is suitable for people with a lot of assets, average age, and good income from their profession business other stable.

Group 3 is the group expected to increase prices. If this group buys it, they will soon be disappointed. Because they will quickly realize that apartment prices are difficult to continue to increase rapidly and will stay sideways for a long time, they will soon get impatient and resell when they see other types of assets increase in price.

The majority of real estate investors in the market are in this group. Therefore, investors in this group are extremely careful. Apartment prices have increased from the third quarter of last year until now.

What advice do you have for people buying apartments to live in?

– If it is a need Buying to live is always suitable if the buyer has accumulated money and appropriate cash flow income. For those who do not have enough money to buy, they should carefully consider their cash flow so they can buy in installments over a long period of time.

In fact, apartment prices in big cities are getting higher and higher. Apartment prices after a 7-10 year real estate cycle often increase by 50-70%. Jobs buying a house in big cities is increasingly a luxury due to great demand and insufficient supply. If we talk about financial investment, investing in apartments is not very effective. But if you want to accumulate safe investment assets and have rental cash flow, many people prefer the apartment type.

If you pay a little attention to the time of purchase, at this time, if buyers do not have enough money to buy an apartment in the inner city, they should wait another 1-2 years until the supply of suburban projects is opened. There will be more attractive options and policies.

In addition, if at this time you do not have enough money to buy an apartment to live in, focus on increasing your income to catch up.

In reality, not only in Vietnam, apartment prices in big cities in other countries are also increasing very strongly, so there is hardly any way to stop it from increasing or decreasing.

House prices keep increasing, people’s dream of owning a house is becoming more and more luxurious

How do you evaluate the current apartment market?

– Apartment prices have been flat for a long time, even falling in price during the 2016-2018 period while other types of real estate increased in price.

Currently, in the context of low interest rates, the economy faces many difficulties, supply is scarce, new opening prices of apartment projects increase, cash flow flows into real estate.

Buyers choose Old apartments are easy to understand because apartments in big cities are legally safe, easy to liquidate, and the demand is large and continuously increasing. The reality of such rising prices makes the dream of buying a house for many people increasingly expensive. The gap between rich and poor is increasingly high.

What do you predict about the apartment market in the near future? coming?

– In my opinion, the price of old apartments has increased so much that it will be difficult to increase again, or even if they continue to increase in 2024, it will be difficult to increase. The price of new apartments for sale will be anchored at a high level due to Input costs such as taxes, fees and construction materials have increased.

As mentioned at the beginning, the cycle of apartment price increase is usually 5-7 years after the increase is a period of price parity or even price decrease. in newly launched projects like the previous cycle.

Thank you!