1,300 Real Estate Companies In Vietnam Closed In 2023
Vietnam Express noted some 1,300 real estate companies went bankrupt in 2023, an 8% increase from 2022, according to the General Statistics Office.
Source: Vietnam Express
Companies that suspended business for a limited time increased by 21% compared to 2022, while companies waiting to complete procedures to be disbanded increased by 29%. On average, 107 businesses go bankrupt every month, while the number of new businesses being established dropped by 45% compared to 2022.
Vietnam’s real estate market has been in hot water since 2022, and the situation persisted until now, even with assistance from the government. Experts said there were issues regarding the law, land handovers, pricing and capital, among others. The precarious real estate scene caused several projects to be delayed, incurring losses for construction and material businesses.
Statistics from the Ministry of Construction revealed the total revenue of several companies under the ministry, including HUD, Coma and Vicem, decreased by 16% compared to 2022. Their profit dipped by 66% compared to 2022, to VND1.38 trillion ($56.86 million).
In a report sent to the Economic Commission, the construction ministry said the real estate market still harbours instabilities, stemming from the risk of a crash, lack of supply and inappropriate goods structure, among other factors. The latest data from the ministry also revealed the number of successful transactions in the first three quarters in 2023 did not reach half of the total numbers in 2022.
Projects were either delayed or suspended due to legal and capital issues. The credit package worth VND120 trillion has only seen VND83 billion being disbursed, less than 0.07%. Analysts anticipated it will be a transitional phase for 2025, when amendments to the laws regarding housing and real estate go into effect.
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