The inventory level in the real estate market continues to increase even though the market has warmed up.
VnExpress, an online newspaper, reported that the inventory value of five big real estate firms, namely Vingroup, Kinh Bac, Khang Dien, Phat Dat and Becamex IJC, had reached VND51,087 trillion, or $2.27 billion by the end of 2015, an increase of 43 percent over 2014.
If considering the inventory volume of 10 big real estate firms, the figure would be VND66.617 trillion, or $2.96 billion, an increase of 37 percent compared with 2014 and 2013 (roughly VND48 trillion).
Vingroup, the largest real estate conglomerate, known for its high-end products, reported inventory value of VND26.966 trillion, up by 65.3 percent. However, most of the products were from unfinished projects, while only VND1.553 trillion worth of finished products remain unsold.
The inventory level in the real estate market continues to increase even though the market has warmed up.
Despite the inventory value increase, Vingroup still obtained high revenue of VND34 trillion and high growth rate of 23 percent in 2015.
2015 was considered a prosperous year for the Kinh Bac Urban Development Corporation when its profit increased twofold and revenue increased by 36 percent. However, its inventory value increased sharply to VND8.364 trillion, mostly because of uncompleted projects on Trang Cat, Tan Phu Trung and Phuc Ninh urban areas.
The inventory value reported by Phat Dat Real Estate Development increased slightly, but it was high at VND5.51 trillion, which accounted for 79 percent of the company’s total assets.
Khang Dien Housing Investment & Trade saw the inventory value rise sharply from VND2 trillion in 2014 to VND5.857 trillion in 2015.
Quoc Cuong Gia Lai Group reported inventory value of VND5.31 trillion by September 2015. The unsold apartments were mostly in Phuoc Kien and Quoc Cuong Gia Lai 2 residential quarters.
Meanwhile, Becamex IJC reportedly had VND4.39 trillion worth of construction works unsold, mostly houses, villas and apartments.
Other big companies have also reported high inventory value even though the sales have become more satisfactory.
Sacomreal, for example, reported inventory value of VND2.735 trillion, Nam Long VND3.673 trillion, Binh Chanh Construction VND2.195 trillion and Housing Investment & Trade VND1.616 trillion.
The Ministry of Construction (MOC) reported that with 38,000 successful transactions in Hanoi and HCM City in 2015, the real estate inventory value in the country decreased by VND54 trillion compared to the end of 2014.
The report showed that the value of unsold products now had dropped to VND50.889 trillion by the end of 2015.
While MOC is optimistic about the sales, some analysts still said the inventory value has decreased sharply and that real estate developers are still having significant difficulties.