What will happen to the real estate market if the lack of capital continues?

The quiet of the real estate market is a signal that experts predict the market is correcting. Entering 2023, the possibility of sudden prosperity will not be available when the market is still in difficulty in terms of capital.

The capital “hungry” market is serious

“Sereneness” is the assessment of Assoc. Dr. Tran Kim Chung, Former Deputy Director, Central Institute for Economic Management about the current market movements. He said that by the end of 2022, the market is forecasted to be not as active as in previous years and there will be no spike in demand. Cash flows in the last months of the year did not have a sudden boom. Real estate credit is usually long-term, with a large amount of money mobilized, while the characteristics of banks’ capital mobilization are usually short-term.

People buying houses have difficulty because they do not have easy access to bank credit, while interest rates in the market increase rapidly and to a high level, according to the general operating policy. Real estate businesses also face difficulties because at the same time they have to mobilize capital from 3-4 key channels, when credit is tight, the bond market is squeezed.

Looking at the general overview of the market, Mr. Chung acknowledged, adjusted – that is the scenario of the current market. The basic reason for this development is that the operating cash flow decreased and did not meet the growth expectation as at the end of 2021, even falling below the level needed to maintain the market.

Another reason given by Mr. Chung is that real estate prices will increase in 2020-2021 and stay at a high level, not falling in the context of 2022, which also causes the market to decline in terms of transactions.

Besides, real estate businesses also face many difficulties in raising capital for expansion.

In a talkshow with the topic “Unblocking cash flow”, Mr. Tran Minh Tuan, Vice Chairman of the Board of Directors of Smart Invest Securities Company, if the real estate business cannot access capital, the related businesses cannot access capital and do not have the source to do business by the enterprise. collect.

Mr. Tuan said that real estate includes residential real estate, industrial park real estate, tourism real estate… According to Mr. Tuan, if you control cash flow into real estate, you need to consider the type of real estate. What kind of property should be restricted and what kind of property should be promoted.

Currently, access to capital is generally limited for the entire real estate industry. When all real estate groups have difficulty in accessing capital, other industries are also severely affected. Not to mention expanding the maintenance of production and business activities is also shrinking.

Where is the real estate market?

According to Assoc. Dr. Tran Dinh Chung, before the difficult situation of the market in 2023, there will not be many fluctuations to operate according to the trend.

Meanwhile, Mr. Nguyen Quang Van – Chairman of Hai Phong Real Estate Association said that the market is being purified to be more transparent. The shift of FDI inflows and the government’s regulatory policy will help stabilize the market once policies related to credit interest rates and exchange rates are stabilized.

In addition, businesses will have more opportunities to access capital and launch many activities to stimulate market demand.

According to him, the economy still maintains the trend of recovery and growth. The time of 2023 will be the recovery period of real estate in the medium and long term. The market is supported by many factors.

Mr. Nguyen Quang Van also said that in 2023, many expect capital flows to be “opened up” because considering the whole process, it can be seen that capital inflows into real estate still grow over the years, not decline. When the problems of the real estate market are removed, the reform and improvement of land law policy will be a “springboard” for real estate to break through.

Intelligent Update/Market life