Sky-high rent
Mai Ly’s family (Cau Giay District, Hanoi) has been renting a house for many years. Recently, apartment prices in Hanoi have been continuously increasing, causing rental prices to increase as well.
Speaking to Lao Dong Newspaper, Ms. Mai Ly said: “During the COVID-19 pandemic, I rented a luxury apartment with 2 bedrooms and 2 bathrooms for only 12.5 million VND/month. However, recently the landlord asked to increase the rental price to 14.5 million VND/month because the supply of rental housing in the area is scarce and the selling price of apartments is constantly increasing.”
Ms. Mai Ly said that if the landlord increases the rent by 2 million VND/month, her family will have to pay an additional 24 million VND/year.
Currently, the rental price of a 2-bedroom, 2-bathroom luxury apartment ranges from 14-15 million VND/month. The room is fully furnished with basic furniture.
As for larger apartments such as 3 bedrooms, 2 bathrooms, basic furniture, the price ranges from 17-20 million VND/month. Especially for large apartments with 4 bedrooms, 3 bathrooms, fully furnished, the rental price ranges from 24-26 million VND/month. Due to the high price of apartments, small apartments such as studios or 1+1 apartments with a price range of 3-5 billion VND have high liquidity.
Mr. Hoang Hung (Hai Ba Trung district, Hanoi) has been "red-eyed" for 3 months now looking to buy a 2-bedroom, 2-bathroom apartment for about 5 billion VND, with a car parking slot in Cau Giay area but has not found a satisfactory one.
A broker said: “If Mr. Hung were to buy a house before Tet, he would have more options. Since the beginning of 2024, a series of banks have lowered interest rates on home loans. Up to 90% of the houses he successfully brokered were bought by bank employees who used the loan as financial leverage to “hold onto the goods”, so the supply of apartments on the market is currently quite scarce.”
Ms. Hien Trang (Cau Giay) has just agreed to spend more than 5 billion VND to buy a 2-bedroom apartment in a newly opened housing area but without a red book. Ms. Trang said: "Because I don't have much money, I agreed to buy an apartment without a red book but with a car parking slot and a convenient location for my children's work and school."
House prices expected to stagnate from 2025
Dr. Le Xuan Nghia, an economic expert, once shared at a talk show: "From 1990 to now, real estate prices in New York, Seoul, and Paris have increased about 100 times. In Vietnam, real estate prices have increased the least in remote and poor provinces, at 100 times, and in Hanoi and Ho Chi Minh City, at about 400 times."
Unable to withstand the "price storm" of apartments, many groups called "Community to stop buying houses in Hanoi to avoid crazy prices" have attracted more than 69,000 members.
Onehousing's Q2/2024 report on the Hanoi residential market predicts that in the last months of 2024, the residential market is expected to record 23,000 transactions, mainly concentrated in the East and West regions.
Ms. Nguyen Thi Hong Van - Deputy Director of Valuation and Financial Consulting Department at Savills Hanoi predicts that in the short term, housing prices, especially apartment prices, will continue to increase due to limited supply in the market. In the second quarter of 2024, apartment supply decreased by 34% compared to the previous quarter and 25% compared to the same period last year. Notably, 98% of this supply comes from existing projects, with almost no new projects.
As the supply of apartments in Hanoi’s suburban areas increases sharply from 2025 onwards, selling prices in these areas may find it difficult to maintain the current rapid growth momentum. This situation may reduce the pressure on housing prices in the long term, especially in suburban areas.
