Apartments under 2 billion VND are scarce
After 3 months of searching for an apartment, Mr. Nguyen Van Linh (Cau Giay, Hanoi) was shocked because the apartments located near the center were expensive, not less than 50 million VND/m2. Because his finances were not high, Mr. Linh decided to look into some apartments without a certificate in Linh Dam area (Hoang Mai, Hanoi).
"I am looking into a 76m2 apartment with 3 bedrooms in HH2 Linh Dam (Hoang Liet, Hoang Mai) that is being sold for 2.92 billion VND, equivalent to 38.42 million VND/m2. In this project, according to my research, the apartment price is fluctuating around 35.1-43.8 million VND/m2. However, legally, there is only a sales contract, so I am still hesitant" - Mr. Linh said.
In fact, recently, the Hanoi apartment market has continuously established new price levels. The affordable apartment segment of under 2 billion VND is increasingly scarce, causing many people to tend to buy apartments without a certificate to save costs.
According to CBRE's Q3/2024 real estate market report, in the primary market, the average selling price reached VND64 million/m2 (excluding VAT and maintenance fees), only 3% lower than the average price in Ho Chi Minh City. Compared to the previous quarter, the selling price increased by 8.7% and 26% year-on-year. Limited new supply for many years has increased purchasing power, while pushing primary prices up rapidly.
In the secondary market, the average selling price continued to increase from the previous quarter, reaching VND46 million/m2 (excluding VAT and maintenance fees), up 5.5% quarter-on-quarter and nearly 26% year-on-year. The increase in secondary selling prices of Hanoi apartments shows no signs of stopping and is currently only about VND2 million/m2 above the secondary price of apartments in Ho Chi Minh City.
Supply is expected to focus on the high-end segment.
According to CBRE's report, in the first 9 months of 2024, the total supply of newly launched apartments in Hanoi reached more than 19,000 units, exceeding the total supply for the whole year of 2023. In the third quarter alone, a large new supply continued to be recorded, reaching approximately 8,230 units, nearly equal to the new supply of the previous quarter.
The supply launched in this quarter came from 11 projects, mainly projects developed in metropolitan areas in the West and East. Of which, this quarter recorded 5 projects launched for the first time, mostly concentrated in Nam Tu Liem, Tay Ho, Gia Lam districts and Van Giang district (Hung Yen province bordering Hanoi).
In terms of segments, more than 75% of the total new supply in the coming quarter will come from high-end apartment projects. Of these, only 2 projects have an offering price of around VND50-60 million/m2, the remaining projects all recorded an average primary price of over VND60 million/m2 (excluding VAT and maintenance fees).
CBRE forecasts that in the last quarter of 2024, new supply will record an additional 10,000 units, bringing the total number of newly launched apartments for sale in 2024 to nearly 30,000 units, nearly 3 times the number of units launched in 2023 and the highest supply in the past 5 years.
A large proportion of supply is expected to be concentrated in the high-end segment. In addition, secondary prices will continue to increase in the context of abundant primary supply, but at a stable rate.
