By SGT staff
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| An overview of the seminar, titled “What is new in Kien Giang’s real estate market,” was jointly organized by the provincial government of Kien Giang and Saigon Times Group on June 15 - PHOTO: TRUNG CHANH |
The seminar, titled “What is new in Kien Giang’s real estate market,” was jointly organized by the provincial government of Kien Giang and Saigon Times Group, with an aim to get an insight into factors behind turbulent land transactions.
In his opening remarks at the seminar, Kien Giang Province Chairman Pham Vu Hong noted the fast urbanization in the Mekong Delta province, saying one-third of its population is living in towns and cities.
Many residential, commercial and tourist complexes have been springing up lately, meeting the demand for accommodation by both locals and tourists and contributing to the province’s socio-economic development, Hong said.
However, numerous problems are surfacing in Kien Giang’s real estate market regarding the operational mechanism, market players, structure of realty products, transaction systems, and the local government’s capacity to control the market, the provincial leader said.
“The ultimate goal is how to improve transparency so as to tap the potential of the realty market and bring its advantages into play in accordance with the approved master plan,” Hong told the seminar.
Chaotic transactions on Phu Quoc
Phu Quoc Island off Kien Giang Province stole the spotlight at the seminar, as land tranactions have turned chaotic there lately, as seen in an overview given by Nguyen Xuan Loc, director of the provincial Department of Natural Resources and Environment.
While acknowledging the fast urbanization process on the island that has helped spur socio-economic development in the island district as well as the whole province, Loc admitted that real estate transactions there have veered off the local government’s management, especially after news of the island being chosen for development into a special economic zone.
Numerous illegal land deals have taken place, which on one hand causes a loss of revenue for the provincial budget, and stirs up social turbulence that gives way to numerous disputes on the other hand, said Loc, adding that such a situation can be partially attributed to a lack of transparency.
Citing data from Phu Quoc Land Registry Office and other notary offices, Loc said last year saw 7,690 land transactions with a combined area of 634 hectares, but this first quarter witnessed the respective figures amount to 4,578 deals and 361 hectares, rising by more than twice compared to the previous year’s first quarter. Most of the land buyers came from Hanoi, HCMC and some other cities in the country, he said.
The data however only mirrors those deals conducted via official channels, while the number of illegal transactions is beyond local authorities’ knowledge, according to Loc, who stressed that such deals pose numerous risks to both the people and the government.
“Transactions of forest land or land without land-use certificates are rampant, which is risky to land buyers as they do not know whether areas they acquire are in accordance with zoning plans or not,” said Loc. He added that a number of households leasing forest land from the State have illicitly transferred the public land, which make the land market even more chaotic.
Part of the turbulence is due to the lack of transparency in land management in Phu Quoc, he told the seminar. Local authorities have not promptly provided information on zoning plans, giving way to false news or rumors spread by land brokers about such zoning plans, while inspections by authorities have been inadequate, Loc said.
The negative implications will not only impact land buyers, but the State agencies as well. He anticipated an upsurge of land disputes between buyers and sellers, while authorities and genuine investors will face difficulties when it comes to site clearance for their approved projects.
Urbanization to continue fast growth
In his report given at the seminar, Le Quoc Anh, director of Kien Giang’s Department of Construction, revealed that the urbanization ratio in the province is currently 28.49%, but the ratio is poised to rise quickly in the coming years under master zoning plans already approved.
The provincial government targets to raise the urbanization ratio to 32.2% by 2020, and up to 41.5% by 2025, in accordance with a master plan issued in 2010 by the provincial government, Anh said. That is to say the newly-urbanized area will increase by nearly a half within the next seven years.
To realize the goal, Kien Giang should raise the number of cities, towns and townlets to 23 by 2025 compared to only 14 now. By then, Kien Giang will have two first-grade cities namely Phu Quoc and Rach Gia, one second-grade city named Ha Tien, and 19 other lower-grade towns.
Given the chaos on the provincial real estate market and the target of fast urbanization in the coming years that will usher in more complications, experts at the seminar called for measures to assume proactive control of the market by local authorites.
Referring to Phu Quoc, Dang Hung Vo, former Deputy Minister of Natural Resources and Environment and also an expert in the sector, observed that land fever is a normal phenomenon when infrastructure develops, but it would be a grave concern if land prices turn overheated due to failure by authorities to control transactions.
Vo suggested that authorities take measure to ward off speculators who seek to cash in on the fever by surfing in the real estate market, especially when grassroots officers join forces with speculator for the aim.
The local government should also improve transparency by disclosing all information regarding zoning plans to contain land fevers, he said. In addition, high taxes should be slapped on land transactions conducted within short periods of time to prevent speculation and overheating.
Do Viet Chien, former head of the Urban Development Department under the Ministry of Construction, suggested that Kien Giang have a full-fledged urbanization program with specific short-, medium- and long-term targets, and allocate resources to realize such targets.
“Areas to be urbanized should be made transparent, with concrete steps of development for every year and every five years so as to avoid thinly spreading invesment resources,” he said.
Tourism property highlighted
Experts agreed at the seminar that Kien Giang needs to focus on tourism property as its strategic approach, given numerous natural conditions there.
“Kien Giang has its coastline facing the Gulf of Thailand, instead of the East Sea like other localities. This condition makes the province stand out in terms of the marine environment,” said Dang Hung Vo. He stressed the coastal section from Rach Gia towards Phu Quoc should be the strategic location for tourism property development.
The province should rev up its real estate market by focusing on tourism, which will make Kien Giang a peculiar location, according to Vo.
Regarding Phu Quoc, he asked the provincial leadership to invite big conglemerates to develop tourism infrastructure, and in turn, other smaller enterprises will follow suit.
Do Viet Chien, meanwhile, also agreed that urbanization in Kien Giang should follow the model of green development, targeting smart and ecological measures.
With his position as an investor, Tran Dao Duc, deputy general director of CEO Group as owner of Novotel Phu Quoc, said that tourism property should take center stage in the real estate market in Kien Giang, and “the nucleus of an ecosystem of accommodation, entertainment, and international transactions.”
He laid special emphasis on Phu Quoc, saying the island has all the favorable conditions for tourism property development, since it is within just two hours’ flying from all capital cities of Southeast Asian countries.
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