·         HCMC's condo market in Q1 2022 was stagnant given the negative impact of the licensing issue from 2019, landbank scarcity and cautiousness of homebuyers after experiencing two years of the pandemic. Total sold units were 1,247 (-78% QoQ and -53% YoY), a result of new supply scarcity, with Akari project of Nam Long (884 units) was the main contributor of the market. Despite of that, the absorption rate of new project is around 90%, exhibiting resilient demand of homebuyers. The ASP continuously went up (+7.8% YoY) and reached VND 55 Mn/sqm (or USD 2,390).

·         We expect the market to recover from 2H2022 with new launches and the fact that large developers are still approaching the market cautiously backed by the rapid rally of materials costs. Businesses with ready-to-launch projects will strongly benefit from prices spike and strong demand. New launches in 2022 are mainly attributed by Thu Duc City, Nha Be, District 7, and Binh Chanh. The tightening of loans and bonds issuance in 2022 remains as our main concern as it will slow down the pace of supply recovery in 2022. While it would pose a stiff challenge to developers having large reliance on loans, firms with strong execution capability and high absorption rate products would be less affected.