 Nguyen Manh Ha, head of the House Management Department of the Ministry of Construction, has been grilled by the media over how to clearly define the forthcoming Real Estate Market Index (REMI).
The property index, which is scheduled to be introduced in the country's largest cities of HCMC and Hanoi, is drawing much attention of property investors and developers as they are uncertain how it will work in the future.
Homebuyers expect it to be a channel for getting reference information about the property market.
Speaking to Nguoi Lao Dong newspaper, Ha said the realty index was designed to create a tool to gauge the market, and forecast orientations for the market, thus ensuring stability for the property market.
Ha noted the local property market for the past years had been strongly volatile, with real estate prices moving up and down wildly due partly to speculation.
The REMI will work in the same way as the consumer price index (CPI) and the VN-Index of the HCMC stock exchange do, he explained. However, it will not be necessarily used as a basis for all transactions to follow but will be more of a reference for them.
"It will contribute to directing the market, thus helping investors and homebuyers make decisions. When following it, they will know which products are going up or down, then they will decide on their investments and transactions," Ha said.
Ha also made it clear, that the property index may not reflect actual value of realty. The Ministry of Construction will coordinate with the General Statistics Office, economic management institutions and market research Organizations to build up the index.
He conceded that it would prove, to be impossible to create an index for the national market. "Building an index for the whole country is very difficult because parameters in different regions can lead to different results. Thereby, each region will have their own REMI, with HCMC and Hanoi becoming the first to have the index," Ha said.
He added the method for calculating the index could be for specific market segments such as luxury apartment, land, house, office buildings and hotels, among others.
Besides, the Ministry of Construction will use information from benchmark property transaction centers for building the property index. The ministry has ruled that from next year, property companies will be compelled to introduce their products to property transaction centers as an effort to boost transparency and thus prevent speculation on the market.
Currently, some real estate companies have established their own property transaction centers to introduce products, contributing to making the property market operate more professionally and transparently.
Source: Saigon Time |
