According to a report by CBRE Vietnam, in Ho Chi Minh City, in the fourth quarter of 2024, the average primary selling price of apartments reached VND 76 million/m2 (excluding VAT and maintenance fees), an increase of nearly 24% year-on-year.
This increase is due to more than 70% of new supply in the city last year, mainly high-end to luxury projects and projects opening for sale in the next phase, adjusting the selling price to increase by 10-40% compared to the previous phase. There is a project in the Thu Thiem area, the end of 2024 is offered with the selling price of apartments up to 490 million VND/m2 of net area...
In the secondary market, apartment prices in Ho Chi Minh City continued to increase slightly, with an average increase of 1% quarterly and 7% annually. Metro Line 1, which began commercial operation at the end of December 2024, has increased the selling prices of projects along this metro line by 2-3% quarterly and nearly 15% annually, typically in the Thu Duc City area.
According to experts, this selling price is far beyond the affordability of most people in Ho Chi Minh City with an average income of about 5,000 USD/year, or about 10.6 million VND/month at present. Not only this year, but also in the next one to two years, housing prices will continue to increase when the new land price list is applied.
Through discussions with many real estate businesses, it is clear that they are also under considerable pressure when land prices increase sharply, along with land use costs that investors must pay. These factors will push the final selling price to an unaffordable level. Currently, many companies are still facing difficulties due to legal issues, large inventories and disrupted cash flows. Not to mention, the implementation of new projects as well as the handling of old backlog issues are still facing obstacles, leading to increased costs, the longer the legal waiting time, the higher the costs.
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, said that in 2024, for the first time, the high-end housing segment will dominate the entire Ho Chi Minh City real estate market and currently, there is no longer a supply of mid-range and affordable housing in commercial housing projects. This reality further distorts the housing product structure in the Ho Chi Minh City real estate market.
To reduce housing prices, Mr. Chau said, it is necessary to increase the supply of housing, especially affordable housing. But to increase the supply, more than 148 projects that are stuck and have backlogs must be resolved.
“HCMC and businesses need to increase housing products, especially affordable housing products. At the same time, if 1 million social housing units are successfully implemented, housing prices will decrease,” said Mr. Chau.
From another perspective, Ms. Duong Thuy Dung, CEO of CBRE Vietnam, said that to reduce housing price pressure and meet real housing needs, it is necessary to expand urban development to suburban areas. This requires synchronous investment in infrastructure such as transportation systems, metro, bridges and roads, to ensure convenient connections between the suburbs and the center of Ho Chi Minh City.
However, in Ho Chi Minh City, the development of suburban areas such as Cu Chi or Nha Be still faces many obstacles due to lack of infrastructure connection. To improve, the government needs to prioritize investment in beltways and expressways, thereby creating conditions for the development of land funds at reasonable prices for commercial housing.
