Market liquidity remains low despite discounts and loan incentives offered by developers to boost sales, said Vo, also former Deputy Minister of Natural Resources and Environment.
Some investors face a financial crunch selling properties at 15-20% discounts. "If the discount rate increases to 50%, ordinary people will still find it hard to buy," he said, adding that most ordinary people have not been able to afford high-priced properties.
The apartment absorption rate in Ho Chi Minh City was 15%, the lowest since 2019, while unsold inventories rose to a four-year high of 66% of primary supply, according to property consultancy Savills.
Cushman & Wakefield said sales fell by half starting July, and the Vietnam Association of Realtors said property sales have been plunging this year.
Online listing platform Batdongsan saw searches for properties in HCMC, Hanoi, Danang, and Can Tho drop by 14-19% year-on-year.
If the property market continues to slow down, "many real estate enterprises may go bankrupt," Vo said.
The former deputy minister said that the State should address the problem appropriately, and not hastily adopt intervention measures now. Property prices should further decline in a couple of years and so most people will be able to benefit from that.
Property investors should cut their losses now and save themselves instead of waiting for the State to rescue the stalled property market, he said.
However, he noted that if the stalled property market causes a too high ratio of bad debt, "the State should consider taking measures to prevent the bad debt from destabilizing the macro-economy," especially financial market.
Tran Khanh Quang, CEO of property developer Viet An Hoa, said that the selloff this year is only the beginning and more financial challenges can be expected in the coming years, especially for those who use loans to make investments.
"Further drops in prices are expected next year with prices half of what they are now."