Data from the Vietnam Real Estate Market Assessment Institute (VARS IRE) shows that in the past three years, the relationship between house prices and rental prices has become increasingly unbalanced. The rate of increase in housing prices in major cities such as Hanoi and Ho Chi Minh City is far exceeding the rate of increase in rental prices.
Accordingly, the average primary apartment price in major cities such as Hanoi, Ho Chi Minh City and Da Nang recorded an increase of about 35-40% per year. When new projects are launched, most belong to the high-end and luxury segments, pulling the level of secondary housing prices to increase sharply accordingly. In some areas, real estate prices have even doubled after only about two years.
Meanwhile, house rental prices, although also tending to increase due to high real housing demand and increasing not being met, have to switch to the rental market, but the growth rate is much lower. The average apartment rental price only increases by about 10-15% per year and by 2025, the rental price increase rate is only about one-third of the house price increase rate.
This difference creates a relative advantage for tenants, as monthly housing costs are not pushed too high.
However, for the group of people with good income and who have accumulated, the picture is clearly different. Thanks to the lending interest rate level maintained at a relatively low level along with preferential policies from investors such as interest rate support, principal grace periods in the early stages and interest rate ceiling commitments, the gap between house installment costs and rent is increasingly narrowing. In the context that house prices in large cities are difficult to reduce, delaying house purchases may cause buyers to face a higher price level in the future.
At the same time, in reality, the current rental market in Vietnam still does not have sufficiently strict regulations to protect the long-term rights of tenants, from rental terms, price adjustments,... Therefore, renting houses is mainly a flexible solution in the short and medium term, rather than a sustainable housing option. Moreover, the value of real estate in large cities is not only in terms of housing function but also associated with the increase in value from the increasingly complete infrastructure system, especially in large urban areas that are synchronously planned.
In summary, VARS believes that renting houses only truly becomes a "cheap" and sustainable option when there is strong State participation in developing rental housing funds. Experience from developed countries such as Germany shows that the rental market only operates effectively when there is a large supply of rental housing, reasonable prices, a legal framework to protect tenants and a developed public transportation system, allowing people to rent houses far from the center while still ensuring access to employment.
To meet the housing needs of people in Vietnam, it is necessary to synchronously implement many solutions. In addition to developing social housing, the State needs to accelerate the construction of long-term rental housing funds from the National Housing Fund at appropriate prices, prioritizing young workers, civil servants, young intellectuals and workers in key industries. At the same time, it is necessary to encourage investors to participate in developing affordable housing through preferential policies on taxes, credit and land costs.
In parallel with that, accelerating investment and completing public transport routes connecting the central area with the suburbs is a key factor. When infrastructure is improved, suburban areas, where there is abundant supply and quality with prices about 20-30% lower than the central area, will become a more feasible option for both tenants and homebuyers, contributing to reducing housing pressure in large cities and towards the sustainable development of the real estate market.
