Housing supply in 2024 is the lowest in the past 5 years, which affects the supply that buyers can buy. Due to the lack of supply, prices are anchored at high levels, with new projects selling at higher prices than before.
According to the 2024 real estate market overview report recently released by real estate consultancy Avison Young, apartments priced under VND40 million per square meter have disappeared in Ho Chi Minh City.
According to Avison Young, the average selling price of primary apartments in Ho Chi Minh City is approaching the high-end segment, averaging from 72 million VND per square meter. Old projects that have just been restarted also announced new prices that are about 30% higher than before. There are no new projects on the market with prices below 40 million VND per square meter.
Data from the Ho Chi Minh City Department of Construction also shows that in the past 11 months, the city only had 31 commercial housing projects under construction, with a scale of 31,167 units, about one-third of the number of projects implemented in the same period of previous years. Of which, there were 4 housing projects eligible for capital mobilization with 1,611 units, down 90% compared to the same period last year, 100% of which were luxury housing with an average selling price of up to VND9.39 billion per unit. This is only the primary price registered by the investor with the Department of Construction, it is likely that when sold on the market, the actual price will be higher.
Statistics from the Ho Chi Minh City Real Estate Association also show that the city's housing product structure has been seriously unbalanced over the years following the "inverted pyramid" model. Since 2020, this situation has been warned when the affordable housing segment (under 25 million VND per square meter) "extinct", high-end housing accounts for 70.6% and mid-range (over and under 40 million VND per square meter) is about 28%. In 2021, high-end housing will increase to 72%, in 2022 it will account for 78.3% and in 2024, 100% of the supply will be high-end housing.
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), said that Resolution No. 171 has allowed a pilot implementation of the land access method through an agreement on receiving land use rights or having land use rights to implement a commercial housing project, where the land is not residential land.
This will facilitate the increase in supply of commercial housing projects, but there is a delay from the policy coming into practice and the delay of commercial housing projects usually takes 3-5 years to prepare for investment and because Resolution No. 171 is being piloted for 5 years.
Mr. Chau said that, in addition to perfecting land access methods to increase project supply and increase commercial housing supply, contributing to reducing housing prices, there is also a very important goal that needs to be achieved during implementation, which is to promote the restructuring of the real estate market.
“The focus is on restructuring the commercial housing market for safe, healthy and sustainable development, especially in some large cities where the “housing pyramid” model is upside down, with a mismatch in commercial housing products, and a shift towards the high-end housing segment, but there is a severe shortage of affordable housing and social housing. Therefore, the Association proposes that the provincial People's Committee be given priority in approving pilot projects for real estate businesses proposing to implement mid-range commercial housing projects or affordable commercial housing projects in accordance with the actual situation of the locality,” said Mr. Le Hoang Chau.
