Land plots in the suburbs of Hanoi have always been considered one of the attractive segments in the face of the trend of moving to the suburbs and rapid urbanization, causing the demand for real estate as well as investment in suburban real estate to increase sharply. However, the recent boom in land prices has also raised many questions about sustainability and potential risks in the context of unpredictable market fluctuations.
During the 2021-2024 period, some suburban districts of Hanoi such as Gia Lam, Dong Anh, Hoai Duc and Dan Phuong recorded a sudden increase in prices with many places having land prices doubling or even tripling. Especially since mid-2024, when recent suburban land auctions have "heated up" the market.
According to Mr. Le Minh Tuan, a veteran investor in Hanoi, the trend of moving to the suburbs is inevitable in the context of rapid urbanization. "Investing in suburban land is a reasonable choice in the context of high inner-city real estate prices. With the development of infrastructure, I believe that the value of land here will continue to increase." Hanoi's push to implement satellite urban planning is also a positive supporting factor for this market.
Speaking of potential, experts agree that land in the suburbs of Hanoi will have a lot of room for price increases in the future. The most important factor is the rapidly upgraded infrastructure, creating better connections between the center and the suburbs.
However, this potential does not mean automatic profit. Investors need to pay attention to many risks in the context of unpredictable market fluctuations.
Regarding the increase in land prices over the past year, Mr. Dinh Minh Tuan - Business Director of PropertyGuru Vietnam - said that the average selling price of land in Hanoi in November 2024 was 70 million VND/m2, an increase of 32% compared to the beginning of 2023.
The recent price increase has also increased financial pressure on investors.
Mr. Nguyen Huu Quang, a real estate broker in Hanoi, said: "Land prices increasing too quickly will lead to weak liquidity when real buyers cannot afford to pay, while investors cannot sell at the expected price."
In particular, areas where land prices far exceed their real value or where legal and planning issues are unclear can easily become "traps" for inexperienced investors.
A typical example is the Dong Anh area, where land prices in some locations near large projects have skyrocketed to an average of 70-100 million VND/m2, even exceeding 100 million VND/m2 in many areas, while just a few years ago the price was only about 30-50 million VND/m2. This increase is considered to be far beyond the actual absorption capacity of the market. If the infrastructure is not completed as expected or the demand is not strong enough, investors who buy at high prices will face the risk of "burying capital" for a long time.
Another factor is the crowd mentality, many investors invest in land based on the general trend of the market with the expectation that prices will continue to increase without a careful assessment of the real value. This mentality not only increases the possibility of a land price "bubble" but also increases the risk of loss if the market corrects.
Therefore, experts have repeatedly warned investors to be extremely cautious, avoiding chasing price "fever" and the crowd psychology effect. Real estate investment is a long-term game and is not for those who lack preparation and knowledge. Choosing the right time, the right area and having a long-term strategy will be the key to minimizing risks and maximizing profits.
