According to surveys from market research companies, the housing supply in Ho Chi Minh City in 2024 will continue to be lacking, and it is worrying that from 2021 to now, in new housing projects, there is no longer any affordable commercial housing with a selling price of less than 30 million VND/m2, and there is also a shortage of social housing. In contrast, the high-end housing segment from 2020 to 2023 has continuously accounted for the majority of the market with about 70% of high-end housing.
Housing prices have been increasing continuously over the years and are still "anchored" at very high prices, such as the price of luxury apartments in 2024 reaching 90 million VND/m2, an average of about 9.7 billion VND/apartment (this is the primary price when approving the project, not the selling price). This price has exceeded the financial capacity of the majority of people with average and low incomes in urban areas.
According to a recent report from the Ministry of Construction, apartment prices have increased sharply in 2024. In Ho Chi Minh City, the increase fluctuated around 20 - 30% compared to the previous year. In Hanoi, the price increase was up to 40 - 50%, thereby pushing the average price of new apartments to 60 - 70 million VND/m2.
That is why, although interest rates have now dropped to a “reasonable” level, few people dare to borrow money to buy a house because the house prices are too high. The situation of young workers having difficulty accessing housing opportunities is common, especially in big cities in the context of an increasingly large gap between house prices and incomes.
According to the research results of the real estate website Batdongsan on the difference between average salary and house price, in 2014, with an average GDP per capita of about 5.5 million VND per month, a young person (aged 25-40) needs to work and save for 22 years to have enough money to buy a 60 m2 apartment, priced at 1.5 billion VND (conditional on a mobilization interest rate of about 6% per year).
By 2024, GDP per capita will increase to about 9.5 million VND per month, with the same apartment area, the price will be about 3 billion VND and young people will need to work and save for at least 26 years to buy it. However, this possibility only occurs under the condition of a 4.5% interest rate. If the interest rate is higher, the number of years needed to accumulate can increase to over 30 years, not to mention the fact that real house prices are still increasing very high.
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, expressed his opinion that the State Bank should consider building a mechanism for young people (aged 18-45) to buy their first home and get a loan with a reasonable commercial interest rate of about 6-7%/year, with the loan secured by the house itself for a period of 10-15 years.
According to Mr. Chau, this will create a "push", encouraging businesses to restructure existing real estate projects, shift investment to the affordable commercial housing segment and, together with the "Program to develop at least 1 million social housing apartments in the 2021-2030 period", will restructure the real estate market to be safe, healthy and sustainable.
“Most young people are ambitious and have a long life to do business and pay off debts. Normally, after about 10-15 years, their income will double or more than double, so there is almost no risk for commercial banks to lend,” Mr. Chau stated his opinion.
To solve the housing needs of the majority of people, according to experts, the important solution is to quickly balance the supply-demand balance, especially increasing the supply of low-cost, affordable housing and social housing. And to increase the supply of the above types, the political system, all levels, sectors, especially localities need to create conditions to support the development to the maximum to attract more businesses to join hands to invest in and make affordable housing projects. From there, the housing problem can be effectively solved.
