At a recent workshop, Dr. Nguyen Van Dinh - Vice President of the Vietnam Real Estate Association - said that by 2024, nearly 67% of new apartments in the Hanoi market will be in the high-end and luxury segment.
It is predicted that the primary segment priced at VND50 million/m2 will disappear by 2025. Experts even believe that new apartments priced below VND50 million/m2 in Hanoi will soon disappear. The story of affordable commercial housing, which was expected to re-establish the balance of supply and demand in the market, is now increasingly distant.
Statistics from the Vietnam Association of Realtors (VARS) show that in the third quarter of 2024, the apartment price index in Hanoi increased by 64% compared to the second quarter of 2019, double the increase in Ho Chi Minh City.
Apartment projects opened for sale from the third quarter all have prices from 60 million/m2 or more, the whole market recorded more than 30,000 products opened for sale.
In particular, the apartment market source in the central area of Hanoi including Hoan Kiem, Ba Dinh, Dong Da and Hai Ba Trung districts is still very scarce. Preliminary in 2024, the central area only recorded about 400 products for sale, with 3 new projects for sale, only about 30% of 2023. More than 90% of Hanoi's apartment supply in 2024 is contributed by projects in suburban districts. The apartment supply in the central area only accounts for about 1%...
"Demand continues to grow, especially the demand for high-end housing from the middle and upper classes, which is constantly expanding along with economic development and from the team of experts following the FDI wave. Investment demand is increasing from customers with strong financial potential, who want to find a safe and long-term investment channel to accumulate assets. Luxury apartments, managed and operated by reputable units with a system of high-class utilities, will attract real demand from high-end customers; they are the "destination" of investment capital thanks to the ability to rent with outstanding and sustainable profitability", Mr. Nguyen Van Dinh emphasized.
In terms of price, although the price level is already high, with the supply always maintained at a low level and special location, the price of apartments in the center will continue to increase in the long term. Rental prices continue to maintain a high price level and a stable growth rate, expected to increase from 7-10% per year.
Mr. Le Dinh Chung - a member of the market research working group of the Vietnam Real Estate Brokers Association - commented that in the coming years, the "thirst" for apartments in the inner city center will continue, because the land fund is currently exhausted, many projects are stuck in legal problems that cannot be resolved immediately. In the inner city of Hanoi, many projects "sold out" after being launched for sale.
Mr. Chung added that the trend of renting apartments to enjoy amenities and improve quality of life has become a popular choice.
"Owning an apartment for rent not only helps investors take advantage of market demand but also brings a stable source of income, less affected by market fluctuations," said Mr. Chung.
