CÔNG TY CỔ PHẦN ĐẦU TƯ NAM LONG (HOSE: NLG)
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As property price in Ho Chi Minh City is rising, buying house in neighbor provinces like Long An is more feasible for citizens with middle income. In the future when the roads are completely built, living in Long An and working in Ho Chi Minh City will not be a big deal.
Long An is within a shorter distance from D1 than Cu Chi district.
Due to the scarcity of land fund for housing projects in Ho Chi Minh City and the increase in property prices, many middle-income people have gone to neighbor regions to buy houses. However, in Long An, the transportation infrastructure connecting with Ho Chi Minh City is not good enough to attract residents.
At the seminar "Ho Chi Minh City - Long An: Connection for development", organized by Saigon Times Group in collaboration with Saigon Times Real Estate Club last week, experts and managers pointed out the limitations and opportunities in Long An, especially for housing development for people.
Talking about the limitations of Long An, Mr. Nguyen Thiem, Vice Chairman of Ho Chi Minh City Planning Association, warned investors to be cautious in developing real estate in Can Giuoc, Can Duoc, and Ben Luc areas. This area has low ground level, many rivers and canals which need to be leveled off, such cost will make the property price higher. Besides, the geologically in this area is weak; water source contains salt and alum, which is hard to supply for daily activities. At present, Long An water supply comes from Dau Tieng Lake in Tay Ninh province, which is far away.
Another limitation is that most of the land in Long An is used for agriculture, therefore it is hard to reuse land for real estate development. In addition, there are still many problems in planning of suburban districts outside of Long An, for example location is far away from main infrastructure, transporting routes have not been expanded, and there are not many infrastructure projects so connecting these areas is very difficult.
Similarly, Mr. Pham Lam, Managing Director of DKRA Joint Stock Company, said that Long An has the advantage of being adjacent to Ho Chi Minh City if the distance is from District 1 to Ben Luc, Duc Hoa and Can Giuoc about 25 km, while the distance from district 1 to Cu Chi is farther away. Thus, it is clear that the adjacent districts of Long An have an advantage.
In DKRA research, Long An had a huge supply of housing with 12,000 properties listed on the maket in 2017. In 2018, this number was reduced to 11,000 properties. In the first 6 months of 2019, the property volume was only 50% of that last year. Currently, real estate buyers in Long An only concentrate in Duc Hoa, Can Giuoc and Ben Luc districts.
Mr. Lam thought that Long An properties have been increased in quantity but the infrastructure has not been improved much. For example, on the road from Nguyen Huu Tho street, Ho Chi Minh City to Long Hau commune in Long An, where there are many real estate projects, the traffic has not been improved much compared to previous years. This causes the properties to be less attractive to buyers.
In the long run, Mr. Lam agreed that developing house in the districts next to Ho Chi Minh City is feasible. “I think that in the long term, from 15 to 20 years, the province should focus on developing houses in districts close to Ho Chi Minh City and moving the industrial parks to further districts. Right now, industrial parks in Long An are scattered in several districts and only in Duc Hoa there is a large size industrial park.” Lam suggested.
The speakers discussing at the seminar
Living in Long An and working in Ho Chi Minh City
Regarding the limitations given by experts, Ms. Dang Thi Thuy Ha, Deputy Director of Long An Department of Construction, also admitted that Long An province still lacks social infrastructure, making development not sustainable and not attracted to the public. To solve this problem, the province will focus on investing in major projects and control the minor projects to keep the planning organized.
To encourage people to move to Long An, Mr. Nguyen Thanh Ngoan, Deputy Director of Long An Department of Transportation believed that they need to invest more into infrastructure. People would move to outer city if only the transportation is convenient enough. According to him, some ongoing key projects, including HCMC - Tien Giang - Long An connections; Road 830 connecting Duc Hoa and Ben Luc, the section from Ben Luc section to Highway 50; the section from Highway 50 to Tan Tap port, will be operated in April 2020.
Besides, Long An will invest in Long An City Ring Road consisting of 4 sections, of which Long An will invest into two and the remaining two sections will need public investment. All these 4 sections are expected to be completed in Q3/2020.
“With the section of Ring Road 3 passing through Long An, local authority has proposed to the Ministry of Transport to finance this project though the form of Build–operate–transfer (BOT) and will invest upon approval.”
At the seminar, the audience has asked many questions about the development of Tan An city in Long An. Ms. Dang Thi Thuy Ha answered that buy the end of this year, Tan And city will be promoted to Class-2. Currently, the city has completed the application and has been waiting for approval. Regarding housing development for districts nearby Ho Chi Minh City, it’s more convenient that house development in the outskirt regions so that people living in Long An could go to work in Ho Chi Minh City or travel back and forth within the same day.
In the past 3 years, many investors have developed large township in the nearby provinces of Ho Chi Minh City such as in Duc Hoa and Ben Luc… In the coming time, the expansion of infrastructure projects connecting with HCMC will attract a great number of people coming to live here. At this time, property price in Long An is still in line with the average income, which means for a longer term, living in Long An and going to work in Ho Chi Minh City would be entirely feasible.