|Property fever and burnt fingers|
|23:48' 23/03/2008 (GMT+7)|
Nailing down accurate information about the nation’s property market is often difficult.
However, it is clear that in some new urban areas, land prices doubled or tripled last year, with some lots in new urban areas in Hanoi and Ho Chi Minh City increasing from $3,120-3,750 per square metre to $5,000 by the end of 2007. Land prices in old Hanoian streets have exceeded $6,250 per square metre, with a square metre worth $62,500 in some places. It now appears prices have stopped rising and are settling.
Contrary to the bustling participation of the non-state economic sector in real estate development, capital for the construction of technical and social infrastructure mainly comes from the state budget.
An economy relying too much on property to develop will sooner or later pay a dear price. Property is a strong force of any economy, but it should not attract too many national resources. It is necessary to prevent businesses and investors from viewing property as an easy way to get rich. The short-term benefit of a minority will cause serious harm to the economy in the long run. A nation’s resources and labour should centre on basic construction, technical, technological and research areas and not be excessively pumped into land and houses.
*Dr Dinh Van An is director of the Central Institute for Economic Management.
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