Vacancy in the affordable housing segment
Savills' report shows that in Ho Chi Minh City, Grade C apartments (abordable housing segment) accounted for only about 29% of the primary supply in the first quarter of 2026, while in Hanoi, no new Grade C projects were launched for sale in the same period. According to a report by the Ministry of Construction, in the first quarter, there were more than 40,000 apartments eligible to be put on the market, but the affordable housing segment only accounted for about 7,000 units.
Ms. Cao Thi Thanh Huong - Deputy Director of Research and Consulting Department of Savills - said that the real estate market in the two major cities has been in a state of shortage of products that can properly meet the affordability as well as the actual housing needs of buyers for many years.
According to Savills data, apartment prices in Hanoi have increased sharply since 2024 and have exceeded the growth rate of Ho Chi Minh City. In the first quarter of 2026, the average primary price in Hanoi reached about 100 million VND/m2, higher than the level of about 91 million VND/m2 in Ho Chi Minh City.
This shows that the real estate market is facing a "large gap" in the housing segment for people with average incomes from 20 - 40 million VND/month.
This is a group of customers with very large real housing needs but are in a "middle" position. They are not able to access high-end products but also do not have enough conditions to buy social housing. Meanwhile, the supply suitable for this group's affordability in the market is very limited.
Businesses face the problem of increased costs
Mr. Ngo Quang Phuc - General Director of Phu Dong Real Estate JSC - said that the affordable housing segment is still a market with very large demand, but it is not simple for businesses to deploy. The first obstacle lies in creating a suitable land fund. To develop affordable housing, businesses are forced to move to the suburban area because there are almost no more opportunities to create reasonable priced products in the central area.
However, although there is still a lot of land in the suburbs, finding a land area that is suitable for planning, has a reasonable price and is eligible for project development is not easy at all. Besides, completing the legal framework for a project may take 3-5 years. This is one of the reasons why the market lacks supply," Mr. Phuc said.
Developing affordable housing segments in the current period is even more difficult as the selling price level continues to escalate due to sharp increases in input costs and loan interest, while liquidity shows signs of decline and buyers' psychology gradually becomes cautious. The problem of balancing cost of goods sold, progress and demand is creating great pressure on businesses.
The director of a real estate business in Ho Chi Minh City said that by the end of 2025, it has planned to officially open for sale in the second quarter of 2026 with the project implementation progress and selling price already set. However, from the beginning of 2026 to now, before the development of input costs being inflated due to most raw materials increasing sharply, businesses are forced to recalculate sales plans, in which selling prices are also forced to increase, otherwise they will suffer losses.
This business added that although deposit interest rates have had periods of cooling down, lending interest rates for the real estate sector are still strictly controlled by banks with a high margin. Real estate businesses have to bear great pressure on loan interest rates for projects that are prolonged due to legal obstacles. When the project implementation time is extended from 3 years to 5 years or 7 years, accumulated loan interest costs must be added to the final selling price that consumers have to bear.
Simplify procedures to shorten project implementation time
Dr. Can Van Luc - Chief Economist of BIDV - member of the National Monetary and Financial Policy Advisory Council - proposed that it is necessary to develop projects with apartment areas of about 70 - 100 m2, prices ranging from 3 - 7 billion VND/unit (depending on the locality), suitable for people with incomes from 20 - 40 million VND/month.
And to develop this segment, it is necessary to remove the biggest bottleneck currently being legal procedures and project licensing processes. The project implementation process is still prolonged, many overlapping procedures cause businesses to spend a lot of time and costs, thereby pushing up product prices.
Mr. Luc also suggested that it is necessary to build a more synchronous policy system for the mid-range housing segment, instead of only focusing on high-end housing or social housing. Policies need to be aimed at both sides, including supporting businesses to develop projects and financial support for homebuyers.
