Recently, the price of old social housing in Hanoi has increased sharply, many apartments that have been used for many years are still being offered for sale at prices approaching mid-range commercial apartments. Recorded at the Ecohome social housing project (Dong Ngac ward), many apartments have increased in price by 4-5 times compared to the time of initial opening for sale.
Talking to Lao Dong, Mr. Tran Van Cuong - a real estate broker in Hanoi - said that at the Ecohome 1 social housing project, a 56m2 apartment is being advertised for sale at about 3.7 billion VND; meanwhile, at Ecohome 2, a 63.6m2 apartment is priced at about 4.1 billion VND. As for Ecohome 3, the selling price ranges from 65 - 75 million VND/m2, apartments with two bedrooms or more cost over 70 million VND/m2.
"Social housing prices are currently increasing following the general trend of the market. Although it is social housing, due to good infrastructure and utilities, the increase in selling prices is understandable" - Mr. Cuong commented.
Mr. Vu Duc Minh (character's name has been changed) - a resident of the Ecohome project - said that he bought a 69m2 apartment in 2018 for more than 16 million VND/m2, with a total value of about 1.1 billion VND, including maintenance fees.
He said that real estate prices are currently increasing. Commercial apartments around this area are being traded at around VND65 million/m2, while social housing is lower. However, with a good living environment, guaranteed security, and complete infrastructure, the increase in housing prices can also be explained.
"What surprised me was that many brokers were selling apartments with similar areas to my house for more than 70 million VND/m2, or nearly 5 billion VND/unit. This price is too high compared to the affordability of people who really need to buy social housing, said Mr. Minh.
A recent survey by Batdongsan.com.vn shows that in early 2024, the Rice City social housing in Long Bien (old) now in Bo De ward had an asking price of 2.3 - 2.4 billion VND/unit, an average increase of 200 million VND/unit compared to November 2023. And after 2 years, up to now, the selling price of apartments has doubled, all from 4 billion VND/apartment or more.
In the same time period, at the Hope Residence social housing project (Viet Hung ward), the selling price also doubled, from 2.1 - 2.3 billion VND/unit at the beginning of 2004 to 3.8 - 4.3 billion VND/unit. Similarly, the Thach Ban social housing project (Long Bien ward) also doubled in price, from the common level of 2.1 - 2.2 billion VND/unit in January 2024 to 3.9 - 4.2 billion VND/unit at present.
The story of double social housing prices also occurred in the old Hoang Mai district. For example, the social housing project @Homes has also set a common price of 4.7 - 5.2 billion VND/unit compared to the average price of 2.3-2.000.000 billion VND in the previous two years.
The Rice City Linh Dam social housing project in Hoang Mai ward also increased from 2.3 - 2.5 billion VND/unit to 4.9 - 5.3 billion VND/unit. Dong Mo Dai Kim social housing increased from 2.2 - 2.3 billion VND/unit to the current average price of about 5 billion VND/unit.
Many other social housing projects in Ha Dong ward, Tu Liem ward, Hoai Duc ward also increased by 2 - 2.5 times in the same period.
According to the Vietnam Association of Realtors (VARS), the imbalance between supply and demand has caused housing prices, especially apartments in large cities, to increase sharply, establishing a new price level and far exceeding the rate of income growth. This not only narrows people's home ownership opportunities but also poses a potential risk of forming price bubbles.
For a 2-bedroom apartment priced at about 5 billion VND, a family with an income of 50 million VND/month will take 8 years if they have all their income, and up to 25 years if they spend according to the principle of only using 1/3 of their income for the house.
Even with social housing, the price of about 1.5 billion VND for a 60m2 apartment also causes a household with an income of 40 million VND/month to save about 10 years, not including borrowing costs.
According to VARS, to develop the market healthily, it is necessary to "reactivate" the hot increase in housing prices through unblocking the supply of affordable housing. When supply is large enough, market prices will automatically adjust according to actual supply and demand.
