CBRE Vietnam’s report said that by 2025, the country is expected to have about 40,000 houses launched on the market. Ho Chi Minh City only accounts for about 20% of the market’s product basket and this situation will continue until 2026 when the city will have only about 11,000 new houses launched for sale.
Ms. Duong Thuy Dung - Senior Director of CBRE Vietnam - commented that the current supply trend of the market is repeating the cycle of the past 10 years. 2024 is the pivotal year when the laws related to the real estate sector are passed, 2025 will be the first year of the new development cycle. Therefore, it will take at least 2 more years for the market to enter the acceleration phase and supply explosion like the previous phase, when the supply will improve.
Meanwhile, in terms of social housing supply, according to information from Mr. Pham Dang Ho - Head of Housing Development and Real Estate Market Department of Ho Chi Minh City Department of Construction, about 10,000 social housing units will be approved for investment, about 7,000 units will be put up for bidding to select investors and about 3,000 units will be invested from public capital in 2025. Currently, Ho Chi Minh City is vigorously developing social housing and proposing solutions for bidding for land funds, using land funds registered by enterprises and public investment to increase supply.
It can be seen that the real estate market in Ho Chi Minh City is experiencing a gap between supply and demand when the supply of real estate, especially low-cost housing, has not yet met the market's demand. In Ho Chi Minh City, since 2018, the proportion of affordable apartments has decreased sharply at a double-digit rate, from 20% in 2018 to 0.5% in 2020 before completely disappearing in 2021 until now.
Experts all agree that it is necessary to have policies to promote housing prices in line with demand and speed up administrative procedures and remove procedural bottlenecks. Meanwhile, housing prices continue to increase, causing difficulties for people with average and low incomes.
Dr. Dinh The Hien - economic expert - assessed that currently, real estate prices are increasing rapidly, making home ownership opportunities out of reach for people. In the period of 2012-2013, the price of mid-range apartments in Ho Chi Minh City was about 22-25 million VND/m2, high-end apartments were about 30 million VND/m2, and the salary of office professionals was about 20 million VND/month.
However, after more than a decade, the price of mid-range apartments has reached 50-65 million VND/m2, while the salary of office professionals is only about 25 million VND/m2. Dr. Hien commented that salaries have not kept up with the increase in real estate prices. The current price is still higher than the affordability of most people, especially in large cities such as Ho Chi Minh City and Hanoi.
"Housing supply will be difficult to increase sharply because construction permits take a long time. In addition, most of the new supply is still focused on the high-end and luxury segments, making it difficult for prices to decrease," said Mr. Pham Dang Ho - Head of Housing Development and Real Estate Market Department of Ho Chi Minh City Department of Construction.
