In the first five months of 2022, the personal income tax collected from real estate transfer transactions increased by 68 cents. (Photo: VNA) With recently revised regulations to make the market more transparent, manyreal estate transactions have to declare a more reasonable taxable price underthe guidance of tax authorities.
According to the Ministry of Finance, in the first five months of 2022, theamount of personal income tax collected from real estate transfer transactionsreached 16 trillion VND, an increase of 68%. While this figure was 21 trillion VNDfor the whole year of 2021 and 16 trillion VND in 2020.
However, this could significantly impact the real estate market becausespeculative activities will be more closely monitored, reducing the number ofpotential transactions.
Do Thu Hang, Senior Director, Consulting and Research Department, Savills Hanoi,said that along with scarce supply, limited capital was also a"bottleneck" of the real estate market.
However, controlling real estate credit, limiting the separation of land plotsin some localities or strengthening the fight against tax loss is necessary toregulate the real estate market.
According to SSI Securities Joint Stock Company (SSI), the amendment of theLand Law is still under consideration, and with more regulations on theissuance of bonds for investors, new supply from apartments and low-risebuildings projects will continue to be limited.
Le Hoang Chau, chairman of HCM City Real Estate Association (HoREA), saidcredit capital for the economy and in the real estate market were "oxygentanks." If the enterprises could not access the capital, they would risk"suffocation".
Now, the real estate market is experiencing a lack of liquidity because manyprojects cannot be deployed, leading to a lack of products, while the demand ofinvestors and home buyers is huge. Meanwhile, businesses still face difficultyin accessing credit sources.
According to the Ministry of Construction, the number of licensed newcommercial housing projects decreased by 59% in the first quarter of 2022.
Due to the shortage of new supply, primary selling prices in key urban areassuch as Hanoi and Ho Chi Minh City continued to increase.
Meanwhile, the number of transactions in the second quarter of 2022 wasrecorded at 20,325, down 20% compared to the same period last year.
SSI believes that to gain sustainable development for the property market, thereal estate market in some provinces needs to cool.
In 2021-2022, due to the high demand for investment in real estate products,real estate prices in many areas nationwide increased significantly.
For example, land prices in Lam Dong and Binh Phuoc have doubled or eventripled over one year or one-and-a-half years, even in areas without developedinfrastructure.
Therefore, authorities in some localities have stopped licensing agriculturaland residential land to be divided into many small land slots. That helps tocool the market and prevent housing bubbles.
Meanwhile, selling prices at many urban projects in the suburbs have increasedrapidly due to information relating to infrastructure development.
At the beginning of 2022, the Ministry of Transport announced capital of morethan 304 trillion VND for projects in the medium-term public investment planfor 2021-2025. The southern region will benefit most from this investment planwith many highways and international airport projects.
Those have increased the price of many urban projects in the suburbs by 15-20%over the same period last year.
However, according to SSI Securities Corporation, up to 70-80% of home buyersare mainly investors, and most of them choose bank loans because the loans havemany attractive incentives, including interest rate support, deferred paymentfor the first 1-2 years, guarantee in income for some products, loans value upto 80-90% of the loan, and loan term for buying housing up to 35 years.
SSI also said that house selling prices continued to be anchored at a highlevel while liquidity in the secondary market decreased recently.
Profits down
VNDIRECT Joint Stock Company said that in the first quarter of 2022, realestate businesses had a decrease in net profit of 5.7% compared to the sameperiod in 2021 due to the decline in sales of apartments and the rentalsegment.
Meanwhile, according to SSI's research, most real estate investors still setdouble-digit profit growth in 2022, excluding Vinhomes Joint Stock Company(Vinhomes) which plans to reduce profits in 2022 because the company had a highprofit in 2021.
SSI said the net profit of real estate investors in 2023-24 may be affectedbecause the projects in 2021-22 have had higher costs in land, finance andconstruction. Specifically, the cost of input materials such as cement andsteel has increased by 7-15% compared to the end of 2021.
Regarding finance, listed companies try to keep the debt ratio at a reasonablelevel or plan to reduce this ratio gradually. This is a key factor to helpmaintain the stability of the listed real estate companies in the coming time.
However, there are many potential risks for unlisted companies. Many have poorfinances and must raise capital from the issuance of bonds.
On the domestic stock market, the real estate stock price has decreased by 25%compared to the beginning of 2022, equivalent to the decrease of the VN-Indexas of mid-June./.
VNA
